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Container Rates Are Rising Again
A couple of weeks ago, I was receiving word that container prices were heading down. It appears that that was a short-term blip. Bloomberg writer, Brenden Murray, provides us with this disappointing headline: “A Summer of Sold-Out Ships Awaits as Sea Cargo Chaos Intensifies.”
Here is how he puts it:
Container shipping rates are heading higher again, driven to new heights by unrelenting consumer demand and company restocking from Europe to the U.S. that are exhausting the world economy’s capacity to move goods across oceans.
The article reports that container prices will continue to be at historic highs throughout 2021.
Relief may be on the way. Shipping companies are ordering new containers at the highest rate since 2007. Their arrival can’t come too soon.
Hasbro Announces Price Increases
You know something is going on when a toy company raises prices, and it makes news. Last week Hasbro announced it was raising prices on toys, and numbers of news outlets carried the story. Here is a headline from Reuters: “Hasbro toys to get more expensive as costs surge.”
Hasbro blamed the increases on raw material costs. Reuters reporter, Uday Kumar, added: “The toymaker, like most U.S. manufacturers, has had to contend with rising resin, packaging and metal prices, as well as soaring transportation costs due to high demand and supply disruptions caused by the COVID-19 pandemic.
We have talked to a number of CEOs who have reported that they are raising prices as much as 25%. We are told that retailers are working with suppliers by choosing specific items which they think are too price-sensitive on which to take an increase while accepting increases on those that are not.
Where Are the Workers?
Last week we ran an article, “Toy Industry CEOs Talk About Inflation.” In the interview Isaac Larian provided to Fox Business, he commented that “he is unable to find sufficient labor for his American factory.“
His comment echoes this New York Times headline: “As Economy Rebounds, Manufacturers Face New Hurdles.”
After a sharp downturn when the pandemic hit last year, factories are humming again. But the recovery’s speed has left employers scrambling. Despite huge layoffs — manufacturing employment initially dropped by 1.4 million — some companies find themselves desperate for workers.
As the article put it: “It was a lot easier to turn the lights out than to ramp up.”