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During the current peak season for shipping holiday gift items from Asian factories to the West, the cost of sailing a shipping container continues to fall, The Wall Street Journal reported.
There are two reasons. Retailers ordered early to ensure deliveries and inflation has shrunk consumer demand.
As a result, the cost to send a 40-foot shipping container from China to the U.S. west coast sits at about $5,400, 60 percent below January’s rate of almost $14,000.
The rate to ship from China to Europe is around $9,000 now, down about 42 percent from the beginning of the year.
The rate for both routes still exceeds pre-COVID prices but has fallen to less than half of the record $20,000 for both last September.
TREND FORECAST: While shipping rates have fallen $5,400 from East to West, they are still up sharply from before the COVID War was launched from China on their Lunar New Year, the Year of the Rat in January 2020. In 2019, the average cost to send a container between China and the U.S. was just $1,500.
Thus while shipping rates are expected to continue falling through this year and next – as with other soaring commodity and services prices that have shot up – inflation will still persist since most will not scale back to pre COVID War/Ukraine War levels. And as most currencies weaken, it will cost more to get less.