Ad Blocker Detected
Our website is made possible by displaying online advertisements to our visitors. Please consider supporting us by disabling your ad blocker.
Some economists have echoed those arguments, saying it’s a function of supply and demand.
“I think the spike in rates that have taken place during the pandemic is mostly due to an increase in demand for imported goods combined with port slowdowns that functionally act as a reduction in the number of ships operating,” said Colin Grabow, a trade analyst at the Cato Institute.
Daniel B. Maffei, the chair of the Federal Maritime Commission, said in an interview that there was “no question” that changes in consumer demand as a result of Covid had driven a rapid increase in shipping prices. But, he added, “does that mean the carriers have to charge this much?”
The commission has never filed an antitrust case against a carrier. But Mr. Maffei noted that “conditions are absolutely, totally different now than they were two years ago. The pandemic has changed everything.”
The shipping industry denies that its alliances have led to any collusion on prices. The alliances that ocean carriers form allow them to share space, by placing some of their own cargo on a ship operated by a partner. But these agreements specify that companies can’t discuss their prices, Mr. Butler said.
“That’s just not something that happens,” he said.
But some logistics experts say that cooperation between shipping companies has ended up reducing competition and concentrating market power, indirectly giving them more free rein to dictate prices and schedules.
Caitlin Murphy, the chief executive of Global Gateway Logistics, a freight forwarder, said small businesses in particular had been harmed by shipping practices during the pandemic, including when alliances have skipped less profitable ports. Her company had been trying to ship cargo from India to New York, but some carriers were avoiding the port at New York to bypass congestion.
“It’s reducing the supply of available vessels in India, which is driving the price up,” she said. “So it’s become very difficult to move product around the world.”