Vincent Stamer

Update #KielTradeIndicator: The number of containers shipped in the Red Sea fell drastically by more than half in December. The volume was only around 200,000 containers per day, compared to around 500,000 containers in November. This means that the current volume is 66 percent below the volume actually expected, calculated from the freight volume for the years 2017 to 2019. Instead of sailing through the Red Sea, the ships now sail around Africa and the Cape of Good Hope, a detour that takes 7 to 20 days. The longer journey time has significantly increased freight rates, with the transport of a 40-foot standard container between China and Northern Europe currently costing over 4,000 US dollars, compared to around 1,500 US dollars in November. However, the current price is still a far cry from the drastic spikes during the coronavirus pandemic, when transporting a container on this route cost up to 14,000 US dollars. Accordingly, despite a noticeable increase in transportation costs, no noticeable consequences for consumer prices in Europe are to be expected, especially as the proportion of freight costs in the value of goods for high-priced items, such as consumer electronics, is only in the per mille range. Apart from slightly longer delivery times for products from the Far East and increased freight costs, to which the container ship network should quickly adjust, no negative consequences for global trade are to be expected.

The inaugural conference of the @kielinstitute/CEPR joint Research Policy Network (RPN) on #Geoeconomics will be on 30 Nov-1 Dec #CallforPapers on economic security, vulnerabilities, global value chains, international finance, energy security, & more ow.ly/HHnm50PCfm5