Posted 1/22/2024, 3:52:00 PM
Suez and Panama Canal Disruptions Drive Up Shipping Costs, Threatening New Inflation Spike
- Suez Canal traffic has plunged 50% from normal levels due to attacks on ships by Yemen rebels, forcing costly detours
- Panama Canal traffic has dropped 50% due to drought, creating a massive backlog of ships unable to transit
- Higher transportation costs from shipping troubles puts upward pressure on goods inflation
- Cost to ship goods from Shanghai to Rotterdam has tripled recently
- If shipping cost spikes continue, it could trigger another surge in inflation like 2020-2022