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 Mexico Star.

More Information

22 ℃

Fair in Mexico City Intl

Lifestyle

Section

US Denounces Sudan Release of Killer of US Aid Worker

washington - The United States on Wednesday voiced alarm over Sudan's release of a man sentenced to death over the ...

Cambodia Seeks More Loans From Beijing Amid Fears of 'Debt Trap'

Phnom Penh - Cambodian Prime Minister Hun Sen is expected to visit Beijing next week looking to borrow more than ...

Centre to hire 38,800 teachers for Eklavya Model Residential Schools

New Delhi [India], February 1 (ANI): The Central government will hire 38,800 teachers and support staff for Eklavya Model Residential ...

Union Budget 2023-24 presents vision for Amrit Kaal, proposes changes income tax slabs, steep hike in capital investment

New Delhi [India], February 1 (ANI): With a thrust on better logistics and infrastructure, ease of doing business and inclusive ...

Budget 2023: India is moving forward firmly towards net-zero carbon emission by 2070, says Sitharaman

New Delhi [India], February 1 (ANI): During her Union Budget speech on Wednesday, Union Finance Minister Nirmala Sitharaman said India ...

India Upbeat About Economic Growth, Despite Slowdown

NEW DELHI - India's economic growth will slow marginally this year, but the government expressed optimism Wednesday that the country's ...

International

Section