Cargo movements through local ports dip on high inflation
The volume of cargo discharged and loaded at the local ports recently showed a nearly 3-percent decline as demand for shipping goods and raw materials slowed down amid rising consumer prices.
Data from Philippine Ports Authority showed that cargo throughput in the third quarter fell to 70.62 million metric tons (MT) from 72.79 million MT in the same period a year ago.
Cargo traffic for the January to September period, meanwhile, slipped by 1.28 percent to 197.57 million MT from last year’s 200.13 million MT.
The majority of the cargo throughput was in Manila and North Luzon with 77.13 million MT, followed by Northern Mindanao with 36.07 million MT.
The cargo volume handled in Southern Luzon reached 29.29 million MT for the nine-month period; Visayas, 33.74 million MT; and Southern Mindanao, 21.34 million MT.
In total, domestic cargo throughput amounted to 76.63 million MT. Foreign cargo volume accounted for 120.94 million MT of the total throughput.
Passenger traffic for the nine-month period ended September surged by 184 percent to 43.77 million from 15.4 million a year ago.
Royal Cargo chair and group CEO Michael Raeuber previously said the global trade had slowed down after the economy “overheated” when more activities had resumed due to the easing of mobility restrictions, which translated to weaker shipping demand.
“There is less demand from the public because the prices went up. As items cost more money, the public can purchase less,” he said.
Current market volatility, such as inflation and elevated interest rates, were also pushing the consumers not to buy as much and redirect their funds into savings instead, the Royal Cargo official added.
With dampened demand, Raueber said that ocean freight costs have bottomed out as well.
For example, he said that sending a 40-foot container via sea freight from the Philippines to the United States now costs $2,000, which was markedly lower compared to $20,000 months earlier.