An increase of $1,500 on refrigerated containers could be registered worldwide due to the current high cost of operations.
“This strongly influences the supply and demand. Shipping lines may want to raise prices, but if there is not sufficient demand, they simply can not,” said the president of the Panama Chamber of Shipping, Willys Delvalle.
Rates are set according to the route, as some are longer and some shorter, and this is how the rates are set.
Delvalle said port costs are extremely high everywhere, and fuel prices are the same. However, the rates have remained the same or similar to when the fuel cost was $250 per metric ton, while today it is $650 a metric ton, subtracting profitability from the business.
This year Maersk Line announced its intention to increase freight rates for refrigerated containers, which are specifically to transport and store food products from Central and South America and Africa.
This increase, which would become effective this year, 2013, concerns agricultural exporters because it increases their cost of operation in the production of export crops.
“I have heard of an increase of $1,500. However, there is nothing official, and shipping companies have not issued a statement about it,” said Alexis Bravo, president of the Union of Nontraditional Agroexporters of Panama (Gantrap).
Bravo said that last year they paid about $5,200 per container shipped to Europe. Some other shipping companies charged $4,600, and the rate varied depending on the type of company.
According to the export producer, in this business punctuality of shipping is the main factor, which is extremely important to maintain the quality of the merchandise.
“If we add a 25% rate increase, we would be looking at an average cost of $6,700, which is quite high,” said Bravo.
He explained that in a 40 foot container, the maximum load or melons is from 1,400 to 1,500 cases, which divided into $6,700, results in a cost of about $5 that should be taken as the cost of operation. However, selling the goods in Europe would have to include the higher cost of freight, among other things.
Agricultural exporters hope to negotiate with maritime service companies and achieve an agreement on prices, but they are aware that the volume of exports from Panama is small and that it is difficult to press to reach an agreement.
“We have this year about 1,200 hectares of sown cucurbits, which would generate about 2,000 containers, approximately, for export,” he said.
The time of fruit harvest is over four months, which means they will be exporting about 500 containers per month. That amount is small compared to the demand, and the exporters aspire to move at least 5,000 containers to get a better deal.