MEDIA: Iran-Israel conflict intensifies upward pressure on shipping costs
According to market reports, the container rates for the Southeast Asia – Europe route have already increased by roughly 40% compared to the previous year
The escalating tensions between Iran and Israel are placing significant strain on the global shipping sector and are likely to push both sea and air freight costs higher, industry insiders said.
According to market reports, the container rates for the Southeast Asia – Europe route have already increased by roughly 40% compared to the previous year and are expected to rise by another 20 – 25% in the next several weeks if the Iran – Israel tension escalates.
The global maritime transportation sector fell under tremendous pressure following the Panama Canal drought and the Red Sea crisis. Transit times from Asia to Europe and the US already lengthened as shipping companies seek alternative routes, causing longer vessel and container turnover and driving booking fees up.
In India, many companies are switching to air freight to transport their parcels to Europe. Still, the closure and restricted airspace in Iran, Jordan, Iraq, Lebanon, and Israel compelled exporters to explore alternative routes, resulting in increased air freight charges. Air freights from India to Europe are expected to rise by 10 – 15%.