Will the Red Sea shipping crisis fuel inflation?
The increases in shipping costs are likely to pass through into imported goods prices with a lag, depending on both the duration and intensity of the Red Sea shipping crisis. This could rekindle inflation concerns as a result.

Shipping Outlook 2022
Annual contract rates are up sharply in 2022. According to the latest data from Xeneta, Asia-U.S. contract rates are up 122% from 2020, pre-COVID, with bids in early negotiations of 2022 contracts averaging $5,700 per forty-foot equivalent unit.

The overwhelming consensus is this year will remain extremely strong for ocean carriers and extremely expensive for cargo shippers. But there are at least six big “known unknowns”:

The Blue Marlin breaks record moving the BP rig and continues to break it’s own records. There’s now a new ship for decommissioning oil rigs that is hailed as the largest ship in the world, The Pieter Schelte, which is part robot.

Truck shipping rates continue to climb amid recent developments in the trucking industry. It was a whirlwind year for trucking in 2017 and 2018 seems to be more of the same.

The volume of truck freight shipping is ever-increasing. In 2017, truck tonnage (the gross weight of freight moved by trucks) rose 3.7% compared to 2016, the largest annual gain since 2013.

Diesel price spikes, increases in manufacturing output, new regulations and tighter truck capacity have contributed to a steady rise in shipping rates. Indications don’t point towards a change in 2018 either.