Freight to push up prices

The Shipping Rate Surge Part-I

 Copper prices are set to climb, bottom lines of petroleum companies will be squeezed, and manufacturers of consumer electronics durables are starting to feel the pinch.

 All this is the outcome of a surge in shipping rates over the past year. In the case of dry bulk rates, the northward movement has continued in the last two months.

 Rates of dry bulk carriers have more than doubled from about $32,000 a day in mid-September 2003 to about $65,500 in late October 2003. The Baltic Dry Index, an index of dry bulk rates, touched a three-year high on November 3.

 Rates of very large crude carriers rose from around $33,200 a day in October 2002 to around $48,550 in September 2003. Suezmax tanker rates climbed from $21,000 a day in October 2002 to about $24,000 in September 2003.

 What is more, the rates could go up further. The demand for crude tankers is expected to rise in winter. The rise will depend on the severity of the winter.

 However, the order book for tankers, which is at record levels, may check the rise in rates. Shipping lines will be increasing their fleets in the next few months.

 However, dry bulk rates could climb in the next few months, thanks to the global economic recovery, China