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Exporters keep close watch on freight rates – Times of India

NEW DELHI: With sanctions hitting Russia, exporters are being cautious with their provides as they keep close tabs on freight rates, which can see an extra spike as a result of greater oil costs in addition to uncertainty over insurance coverage cowl.
“Some countries have already imposed sanctions against Russia, which will impact payments. We are awaiting the OFAC guidelines as it provides a winding down period, which will provide clarity on payments,” stated Ajay Sahay, the director normal of the Federation of Indian Export Organisations (FIEO). The Office of Foreign Assets Control (OFAC) of the US Department of the Treasury administers and enforces financial and commerce sanctions. While India and Russia had a rupee-rouble commerce association earlier, officers worry that it might not be simple now given the US strain and it will be seen as New Delhi aligning with Moscow.
In addition, exporters anticipate the logistics challenges to extend, particularly to Ukraine as battle shouldn’t be coated beneath insurance coverage insurance policies. Besides, with crude oil costs topping the $100 a barrel stage, freight rates are anticipated to harden additional.
Already, container freight rates have hardened. The spot fee for a 40-ft container from Shanghai to Los Angeles rose to $11,030, up 3. 3% from per week in the past and 125% greater than a yr in the past, in response to the Drewry World Container Index, Bloomberg reported on Thursday.
Freight rates had softened somewhat over the previous few months after a pointy rise as a result of disruptions and lengthy pileups at a number of ports within the US. Already, Indian exporters have been complaining of stretched amenities and better prices in transport items to Russia and different CIS international locations as transport strains had altered their routes.

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