Omicron variant hits global supply chain
RAILWAYS & METRO RAIL

Omicron variant hits global supply chain

The Omicron variant can cause logistic disruptions at the peak season at the end of 2021 as it slowed down major ports and the global supply chain, with shipping and air freight rates at their highest.

The Shanghai Containerized Freight Index (SCFI) increased by 125.09 points to 4,727.06 points last week, the highest even since October 2009. It has increased to over triple from October last year from 1,438.2 points.

The SCFI lowered to 4,535.92 points in the four consecutive weeks and hit the highest, 4,647.60 points on 8 October. The freight rates to the West Americans, major import routes, including Korea, have increased by $289 to $7,019.

As per the Korea Ocean Business Corporation, 80 ships are waiting for unloading near LA and Long Beach Ports, on the west coast of North America. This congestion continued due to the lockdown of the Suez Canal and worsened due to the Omicron variant.

As per the TAC Index, the average freight rates from Hong Kong to North America were $11.54 per kg in November, which is the highest ever. In June, the freight rate increased to $7.89, $7.90 in July, $8.64 in August, $9.74 in September and $9.94 in October.

Export companies are worrying due to increasing freight rates due to the biggest shopping season, including Christmas, it may deteriorate due to increased freight costs and difficulty to get ship spaces and make a profit.

Small and medium-sized companies sign short-term contracts, unlike the bigger companies that sign long-term contracts, the burden of freight costs are increasing. The companies that produce domestically, compared to local producers, are being hit the most.

Image Source

The Omicron variant can cause logistic disruptions at the peak season at the end of 2021 as it slowed down major ports and the global supply chain, with shipping and air freight rates at their highest. The Shanghai Containerized Freight Index (SCFI) increased by 125.09 points to 4,727.06 points last week, the highest even since October 2009. It has increased to over triple from October last year from 1,438.2 points. The SCFI lowered to 4,535.92 points in the four consecutive weeks and hit the highest, 4,647.60 points on 8 October. The freight rates to the West Americans, major import routes, including Korea, have increased by $289 to $7,019. As per the Korea Ocean Business Corporation, 80 ships are waiting for unloading near LA and Long Beach Ports, on the west coast of North America. This congestion continued due to the lockdown of the Suez Canal and worsened due to the Omicron variant. As per the TAC Index, the average freight rates from Hong Kong to North America were $11.54 per kg in November, which is the highest ever. In June, the freight rate increased to $7.89, $7.90 in July, $8.64 in August, $9.74 in September and $9.94 in October. Export companies are worrying due to increasing freight rates due to the biggest shopping season, including Christmas, it may deteriorate due to increased freight costs and difficulty to get ship spaces and make a profit. Small and medium-sized companies sign short-term contracts, unlike the bigger companies that sign long-term contracts, the burden of freight costs are increasing. The companies that produce domestically, compared to local producers, are being hit the most. Image Source

Next Story
Resources

Skyview by Empyrean is Making Benchmarks in the Indian Ropeway Industry

FIL Industries Private Limited, the parent company of Empyrean Skyview Projects that pioneered ropeway mobility solutions in India with Jammu’s Skyview Gondola, is currently developing the Dehradun-Mussoorie ropeway and is on track to complete Phase I by September 2026. The ropeway is set to be India’s longest passenger aerial monocable covering 5.8 km between the foothills of Dehradun in Purkulgam and MDDA taxi stand in the hills of Mussoorie in just under 20 minutes. The firm pioneered green mobility solutions in India with the development of the flagship Skyview Gondola in Jam..

Next Story
Technology

Creativity is for Humans, Productivity is for Robots!

On most construction sites, the rhythm of progress is measured by the clang of steel, the hum of machinery and the sweat of thousands. But increasingly, new sounds are entering the mix: the quiet efficiency of algorithms, the hum of drones overhead, and the precision of robotic arms at work. Behind the concrete and cables, an invisible force is taking hold: data. It is turning blueprints into living simulations, managing fleets of machines, and helping engineers make decisions before a single brick is laid. This is not the construction of tomorrow; it is the architecture of today – built on ..

Next Story
Infrastructure Urban

Bhartiya Urban Unveils ‘Bhartiya Converge’ GCC Enablement Platform

Bhartiya Urban has launched Bhartiya Converge, its latest business venture designed to become India’s premier platform for enabling Global Capability Centres (GCCs). The initiative offers an integrated ecosystem aimed at helping global clients gain a competitive edge in today’s rapidly evolving business environment. Focused on enhancing turnaround time and operational efficiencies, the company seeks to deliver better business outcomes powered by top-tier talent. Bhartiya Converge presents a customised and integrated suite of microservices that addresses the nuanced and evolving operational..

Advertisement

Advertisement

Subscribe to Our Newsletter

Get daily newsletters around different themes from Construction world.

STAY CONNECTED

Advertisement

Advertisement

Advertisement

Advertisement

Talk to us?