Shipping Containers Skyrocket

It was a good year to be in the shipping container biz and 2022 is looking like another banger, according to economists who talked with Bloomberg…(Bloomberg)

• The spot rate for a 40-foot container to the U.S. from Asia topped $20,000 last year. This is up from 2,000 just a few years ago.

• Making matter worse, tight container capacity and port congestion mean that longer-term rates set in contracts between carriers and shippers are running an estimated 200% higher than a year ago.

This jump in prices led to big profits for ocean-freight carriers who pulled in estimated profits of $150 billion in 2021. However, shipping containers are like any other cost increase for producers. As those costs rise, they risk being passed on to consumers which have economists worried Bloomberg reported…

• “The extended windfall has touched a raw nerve across the political spectrum as economists warn that persistently high transportation prices are stoking inflation and clouding the recovery.”

REMINDER: The trade deficit is widening as trade costs continue to rise…

• The goods trade deficit widened in November to $97.8 billion which exceeded the previous record deficit set in September of $97 billion…(CNBC)

• Through November, the United States has collected a record $77.4 billion in tariffs on imports. The previous record was $74.1 billion in 2019. This is money directly from U.S. producers pockets which of course gets passed on to consumers…(Forbes)

QUESTION: How will this impact shipping container home prices?