What are the reasons for high shipping costs?
Accumulated shortfalls and delays.
What are the expectations of DP about freight rates?
Its president assured that prices will continue to rise.
DP World, one of the world’s largest port operators, has forecast that supply chain bottlenecks that increase pressure on global trade flows will continue for at least another two years.
The Chairman and CEO of the company, Sultan Ahmed bin Sulayem, confirmed, in a statement to Bloomberg TV, today, Friday, that the global supply chain was in crisis at the beginning of the Corona epidemic, and perhaps in 2023 it will witness a easing.
“The effects of the accumulated shortages and delays are reflected in the huge rise in freight costs, freight rates will continue to increase and shipping lines are having a great time,” Saleem said.
DP World is one of the world’s largest operators of seaports and inland shipping terminals, with operations spanning from London and Antwerp to hubs in Africa, Russia, India and the Americas.
The company recently announced a series of deals as it tries to become a more diversified and integrated logistics company.
Meanwhile, the company continues to look for ways to reduce debt and is considering offering an opportunity for international investors to buy into the Jebel Ali Free Zone, a valuable asset that has helped turn Dubai into a global trade hub, according to people familiar with the matter.
The company is also reviewing costs related to office space after effectively weathering the disruptions caused by the pandemic.
Bin Sulayem said DP World has canceled plans to build a new headquarters and lease a larger office.
Global supply chains are struggling to keep up with demand and weather the employment disruptions caused by the COVID-19 outbreak.
The world’s largest shipping line, AP Muller-Maersk, has warned that bottlenecks may last longer than expected, and some companies have vowed to cap spot prices.