The Organisation for Economic Co-operation and Development (OECD) is now tracking how much container shipping is factoring into global inflation.
The OECD’s latest Economic Outlook report cites container shipping as a major contributor to inflation among G20 countries.
The OECD is predicting that G20 consumer inflation (CPI) will hit 4.5% by the end of this year with container freight prices and soaring commodity prices highlighted as a big contributor, adding 1.5% to G20 inflation.
The OECD’s shipping input index currently stands at 482 points, versus 100 in February 2020.
“Though termed a shipping index, it relates solely to container shipping and is based on the Shanghai Containerized Freight Index (SCFI),” analysts at Alphaliner explained in their most recent weekly report.
“This atypical situation appears likely to persist for some time, with significant additional shipping capacity only likely to appear in 2023,” the OECD stated in its new Economic Outlook report.
Just how much today’s sky-high container freight rates are contributing to global – and more specifically US – inflation formed the lead story of the September issue of Splash Extra, a subscription sister title to Splash.
Nariman Behravesh, senior economic advisor at information provider IHS Markit, suggested the surge in shipping costs has only added 0.1 to 0.2 percentage point to US consumer inflation, pointing out that shipping only accounts for 3% to 6% of the direct and indirect costs to consumers.