Supply chain professionals are anticipating price hikes for container transport in the aftermath of last week’s Baltimore bridge collision, according to a report by Container xChange.
That trend is shown by Container xChange's Container Price Sentiment Index (xCPSI), which unexpectedly surged from 26 to 61 points between March 18 and March 29. This marked increase suggests that the industry is anticipating container prices to increase in the coming weeks, and the suddenness of the index’s move highlights rising uncertainty in the market, the company said.
Key U.S. ports are now expected to be strained in the short term, following the March 26 bridge incident and additional impacts like a rebound of freight volumes into the U.S. this year, ongoing violence in the Red Sea, and an extended drought at the Panama Canal. As a result, this is expected to lead to increased congestion, additional logistical and operational complexities, and short to midterm price increases, Hamburg, Germany-based Container xChange said.
“The sharp rise in sentiment could be linked to ongoing market volatility, the perceived emergency on the US East Coast due to the Baltimore collision, and the resulting sustained pressure on the market,” Christian Roeloffs, cofounder and CEO of Container xChange, said in a release. “In the short term, the bridge collapse will lead to localized disruptions in container availability and transportation. The incident has also led to increased delivery times and fuel costs which could indirectly impact container prices and leasing rates in the coming times.”
Looking further ahead, the report anticipates increased wait times and processing fees at the U.S. ports where container traffic is diverted while bridge and channel repairs continue. But the most striking impact will focus on the regional supply chain in Baltimore, where the effects on life, the economy, and businesses are most severe, the report said.
Gartner, Inc.