Senior Reporter
otto.carrington@guardian.co.tt
Don’t expect significant reductions in food prices, as two major importers have acknowledged that freight prices appear to be decreasing, but other factors must be considered.
Factors such as increased demand and supply, as well as the effects of climate change, play a role.
Two local importers—Nutrimix and Sheik Lisha Limited—have announced a price reduction on flour due to a drop in freight costs.
Marcus Fernandez, Commercial Manager of Fine Line Distributors, said they are witnessing a decrease in prices. He attributed the price decrease to the influence of demand.
He said, “What you are seeing with the demand for goods created the perfect storm for the shipping world and 90 per cent of the world trade is done on the ocean. So, with that, it definitely caused a big disruption. “What we’re seeing now is some very minimal reduction in terms of freight rates as well as container availability. Those rates could be anywhere between eight per cent and 11 per cent and it depends on the origin.”
He added, “We’re currently getting reductions, but that is nowhere close to pre-pandemic levels. The eight per cent to 11 per cent increase that we’re getting now, when you compare that to price increases that we have in several commodity markets like meat, oil and sugar and rice, it either has a balancing effect or a very minimal reduction. To say that a big reduction is coming, I’m not so sure.”
Another importer, Hank Traders Limited said reductions are still far from reaching pre-pandemic levels.
The company’s managing director, Shiva Ramadhar, said, “That freight, in the past few years, yes we saw the freight rates in certain areas come down. China, for one, went up exponentially during the COVID pandemic period.” Within the past two years, it came down quite a bit, but unfortunately the CIF (cost, insurance and freight) prices for products have not come down. It didn’t come down, which is largely due to the poor weather patterns we’ve been facing. He said as an example, “In China right now they’re starting a new crop of garlic but they have already reduced the crop size itself because they were forecasting lower demand in the world market. On top of that, they were met with bad weather patterns which destroyed quite a bit of the crop.”
Earlier this week, managing director of Sheik Lisha Ltd, in Cunupia, Churchill Azad Akaloo, said that a container was costing between US$13,000 and $14,000 before and that same container is now between US$3,000 and $4,000, so we can afford to go down.”
Guardian Media spoke with the head of the American Chamber of Commerce of T&T’s Express Logistics Committee, Paul Pantin, who said discussions are happening and they are expected to meet on the issue soon.
