S. Korean exporters warned of rising ocean freight rates

Export-reliant South Korean firms were warned to come up with diverse ways to cut down on their logistics costs as ocean freight charges continue to rise, warns the Institute for International Trade.

The industry is currently experiencing unstable supply and demand for empty containers and rising demand due to revenge consumption.

According to the institute, a research center under the Korea International Trade Association, exporters can achieve a competitive price edge by changing the terms and conditions of Incoterms that would reduce down customs duty and logistics fees.

Companies should also consider working closely with customs corporations and specialized logistics companies for a similar goal, the report added.

The Shanghai Export Containerized Freight Index, a benchmark for shipping rates, reached 2,833 points on Friday, going up 241.3 percent from the same week last year when the figure stood at 830.

The Shanghai Shipping Exchange reached a low point last May before it began to rise.

The institute's report pointed out that coronavirus cases among dockworkers and truck drivers compounded by the complicated structure of international logistics resulted in the pileups at ports and slowed the return of empty containers.

The report added that the Ever Given cargo ship's grounding in the Suez Canal last month is feared to have boosted the freight rates, which were then declining.