President Biden to issue executive order to protect ailing American companies who are negatively impacted by exorbitant freight prices.
Container shipping companies have been increasing prices worldwide since 2020 to handle rising demands. Profits in the container shipping industry for 2021 is expected to reach $100 billion for the first time in history. Since Q4 in 2020, prices set by leading world freight transportation companies have increased by over 440% on some routes.
Exporters in America are being negatively impacted. They are less and less competitive as compared to China. According to Drewry, global shipping consultancy firm, in its lates Container Forecast Report, container volumes are expected to increase throughout Q3 until the end of the year by 10%. Worsening supply-chain is expected to continue to drives prices up almost on a weekly basis.
To protect American businesses, President Joe Biden is issuing an executive order this week asking the US’ Federal Maritime Commission and the Surface Transportation Board to step up to what the Biden Administration perceives as monopolistic behaviour and confront anticompetitive pricing.
The US Government believes that the relatively small number of major players in the ocean shipping trade and in the US freight rail enabled companies to charge unreasonable fees.
Following reports on the Administration’s intent, the valuation of Maersk on the Danish market was down by almost 2%.
