Expect freight costs to drop due to low demand, says observers

Sat, 04 Feb 2023

Expect freight costs to drop due to low demand, says observers

Robert Besser
21 Jan 2023, 21:24 GMT+10

DP World's chief financial officer Yuvraj Narayan said the Dubai-based logistics company expects freight costs to drop by a further 15 to 20 percent in 2023
As agencies, such as the International Monetary Fund, lowered growth forecasts, the first signs of a significant drop in demand were clear to see
China, Europe and the US, as the world's largest producing and consuming economies, are the main problems, Narayan said

DAVOS, Switzerland: In an interview with Reuters on the sidelines of the World Economic Forum in Davos, DP World's chief financial officer Yuvraj Narayan said the Dubai-based logistics company expects freight costs to drop by a further 15 to 20 percent in 2023, and the worst is still to come as demand further declines.

As agencies, such as the International Monetary Fund, lowered growth forecasts, the first signs of a significant drop in demand were clear to see, as freight rates on the shipping side had declined considerably on certain routes, he added.

"It is clear that there is a massive drop in demand, inventories are not clearing up, and the orders are not coming through. We have not seen the worst of it yet," Narayan added.

China, Europe and the US, as the world's largest producing and consuming economies, are the main problems, he added, stressing that various shipping rates have witnessed significant declines of anywhere between 20 and 50 percent from their peaks in 2022.

There were three overriding factors driving this issue, which are disruptions during the COVID-19 pandemic, inflation in Europe due to the energy price surge, and severe disruptions to global supply chains, which persist as a result of the war in Ukraine and sanctions against Russia, Narayan said.

Watch latest videos

News RELEASES

Publish news of your business, community or sports group, personnel appointments, major event and more by submitting a news release to Leeds Times.

More Information

7 ℃

Haze in Leeds

Europe

Section

Ireland told to prepare housing, healthcare for 180,000 refugees

DUBLIN, Ireland: An estimate by senior civil servants claims that Ireland could be hosting 180,000 refugees by the end of ...

NATO, Japan look to closer tires due to China, Russia concerns

TOKYO, Japan: In light of a tense security environment following Russia's invasion of Ukraine and Moscow's growing military cooperation with ...

Italy's Meloni in Libya, signs $8 billion gas deal

TRIPOLI, Libya: Italian prime minister Giorgia Meloni held talks on energy and migration in Libya this weekend, which are major ...

UK airline Flybe goes out of business, cancels all flights

LONDON, England: Flybe, a British regional airline, abruptly closed operations on January 28. The airline offered flight to Belfast, Birmingham ...

UK tanks for Ukraine must arrive by March, says minister

LONDON, England: Of the 14 main battle tanks and additional artillery support it will send to Ukraine, Britain hopes its ...

Ireland breathes easier as energy prices decline in warm weather

DUBLIN, Ireland: Ireland's consumer energy prices dropped 15 percent last week, the result of warm weather and full stocks of ...

International

Section

After Biden tapped US oil reserves, House passes bill to end such uses

WASHINGTON D.C.: The US House of Representatives has passed a bill that limits the ability of US Energy Secretary Jennifer ...

US says Russian businessman traded on illegal information

BOSTON, Massachusetts: Russian businessman Vladislav Klyushin, who has ties to the Kremlin, has been accused of making tens of millions ...

NATO, Japan look to closer tires due to China, Russia concerns

TOKYO, Japan: In light of a tense security environment following Russia's invasion of Ukraine and Moscow's growing military cooperation with ...

Texas advises energy companies to prepare for winter ice storm

DALLAS, Texas: Oil and gas pipeline operators are preparing to stockpile equipment following severe weather forecasts for the next few ...

TikTok CEO to appear before US Congress to discuss security concerns

WASHINGTON D.C.: As US lawmakers investigate the Chinese-owned video-sharing app TikTok, its Chief Executive, Shou Zi Chew, has confirmed that ...

Azerbaijan blames Iran for fatal Tehran embassy attack

TEHRAN, Iran: A gunman this week stormed the Azerbaijan Embassy in the Iranian capital, Tehran, and killed its security chief ...

Movie Review

Minions: The Rise of Gru (4K UHD)