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 Manufacturing Mirror.

More Information

25 ℃

Light Rain Shower in Seletar

Small Business

Section

Ireland CEOs voice concern over decline in economy in 2023

DUBLIN, Ireland: A just-released survey shows that over half of the chief executives in Ireland believe the nation's economic growth ...

Profits down 9% at American Express due to late customer payments

NEW YORK CITY, New York: As it sets aside more funds to cover potentially bad loans, American Express announced that ...

DHFL fraud case: Delhi HC extends interim bail of businessman Ajay R. Nawandar on medical grounds

New Delhi [India], January 4 (ANI): The Delhi High Court has extended the interim bail granted to businessman Ajay Ramesh ...

US jury finds Elon Musk not liable in Tesla tweet trial

Washington [US], February 4 (ANI): A US jury on Friday decided that Tesla CEO Elon Musk was "not liable" for ...

After Delhi, Punjab's Liquor scam should also be exposed: Tarun Chugh

New Delhi [India], February 3 (ANI): BJP national general secretary Tarun Chugh on Friday demanded a central agency inquiry into ...

China's human trafficking syndicates lure away hundreds from Southeast Asian countries: Report

Beijing [China], February 3 (ANI):In southeast Asian region, Chinese human trafficking syndicates operate in nexus with local authorities in countries ...

Automotive

Section