Shortage of shipping containers triggered by massive congestion at Chinese ports is giving Indian exporters nightmares. Exporters across product categories are staring at a slump in exports as container charges reach record levels.
India’s exports had hit a record high of $35.2 billion in July 2021 — the highest-ever monthly figure in the country’s history. However, exports now face a risk of slowing down due to the fresh shortage of containers and a subsequent hike in freight rates.
The charges for availing a container to or from India have increased to $7,000-$10,000, compared to $3,000-$4,000 a few months ago, as per industry executives. However, the final cost also depends on the distance covered.
In an interview with Ashmit Kumar, Ajay Sahai, Director General & CEO of the Federation of Indian Export Organisations (FIEO), said, “Since the last few months we are seeing the shortage of container and it has aggravated now. The main problem is for the low-value high-volume cargos because they are not in a position to get the container and also the freight has skyrocketed for them and we are seeing a huge decline in export of granite, marble and furniture. While India’s exports are doing extremely well, this is something which is a cause of concern for us.”
He said the government needs to ensure that not many empty containers are exported out of India.
“We have suggested to the government to ensure that not many empty containers are exported out of India because in some ports we are seeing a large number of empty containers going out of India and that also affects us. Also, a significant number of containers have been stuck up because either the boaters have not taken delivery of the container or they have disputes with the authorities. If we can quickly offload the cargo of the container in some public bonded warehouse then these containers can be added to the supply to soften some of the problems. We have also requested the government to get in touch with the shipping lines so that additional 1 lakh containers can be brought in India to ease it.”