Tariff pause: Freight rates may rise on ‘front-loading’

NEW DELHI: US President Donald Trump’s reciprocal tariff coverage might considerably drive up freight rates for Indian exporters, fuelled by front-loading of orders amid a risky and unsure international commerce atmosphere.
With the 90-day tariff pause on imports from India, freight rates might see an preliminary double-digit spike as exporters rush to e book consignments, business consultants stated. This enhance, including to India Inc’s value burden, might mirror international tendencies, the place freight rates rose 3% to $2,265 per 40-feet container (as per Drewry’s World Container Index) final week.

On April 9, Trump introduced a 90-day pause on reciprocal tariffs, decreasing them to 10% for a number of nations, together with India, however excluding China. Ajay Sahai, DG and CEO of the Federation of Indian Export Organisations, advised TOI: “The exporters’ rush to ship consignments before the 90-day deadline is expected to lead to a double-digit spike in freight rates to the US. Post-deadline, rates could soften.”
For now, the business is in a wait-and-watch mode. Christian Roeloffs, co-founder and CEO of Container xChange, an internet container logistics platform for container buying and selling, leasing, and administration, stated: “Prices are increasing right now, both in typical loading as well as in discharging locations. Essentially, the uncertainty and cancelled shipments are soaking up container inventory. Our members are very much in a wait-and-see mode. Most of them are still expecting structural container price decreases.”
Industry consultants famous that the home container logistics sector stands at a crucial juncture, grappling with international commerce disruptions and Red Sea instability, leaving stakeholders unsure about operational stability. Moreover, India depends closely on leasing containers from overseas gamers, notably China. The current push for home shipbuilding, backed by a Rs 25,000 crore Maritime Development Fund, might change this, however business consultants warning that true self-reliance will take years.
The volatility and complexity of the shifting coverage panorama place international logistics on the forefront, highlighting the significance of agile and sturdy provide chains amid commerce tensions. “It’s crunch time for transport and logistics companies, and we are fully geared up for the task. We have often faced challenging situations where companies’ supply chains were put to the test – and we are well-equipped to deliver solutions. We have previously seen that an integrated logistics portfolio and control over our own assets become crucial when the unexpected creates a need to either slow down or speed up,” says Karsten Kildahl, international chief business officer of AP Moller-Maersk.