Indian exporters brace for price hikes

Indian exporters may have to continue bearing rising shipping costs as normalcy eludes the Red Sea region and freight companies continue to avoid the Suez Canal, opting for the longer route around Africa to reach the West.

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The longer route around the Cape of Good Hope is adding 12-15 days of voyage, and freight charges have gone up by 80-100%, experts said.

"These companies have been looking to increase the freight charges for the past six to eight months, but due to low import-export volumes, the vessels have not been full.

This has helped to keep the cost low. But now with the escalating situation in the Red Sea, these companies are imposing charges that are making the cost rise by 80-100%," said Nilesh Thadani, director, Alltrans Shipping and Logistics LLP.

Shipping major MSC in a client advisory announced that it will implement a contingency surcharge of $1,500 per container on all shipments from the Indian sub-continent to Europe and Black Sea destinations.