Soaring shipping costs hit Northern Ireland traders

Thousands of shipping containers transport goods through Northern Ireland's ports every week

Businesses in Northern Ireland which import and export goods are being affected by rising shipping costs, an industry body has said.

Logistics UK said the cost of importing shipping containers from China has risen by up to 800%.

A number of factors, including the pandemic, are said to be behind the surge in prices.

County Armagh furniture salesman Pearse Dynes described the increase in costs as a "worldwide crisis".

He works for Nugent and Gibney in Armagh, a company which manufacturers and sells furniture.

"Pre-Covid, shipping costs for a 20ft container from Asia were $1,200, [£870] plus local charges of roughly $300 [£217], and that made it profitable," Mr Dynes said.

"This is not the case anymore, as the costs have risen at phenomenal rates of up to $10,800 [£7,820] for a 20ft container. A 40ft container is double that.

"It's a 600% increase and that is just crazy to me."

Pearse Dynes, who sells furniture in Armagh, said shipping costs were wiping out traders' profits

The salesman added: "What it means for us is a chair that we would have bought in Asia before Covid-19 would have cost us £60, now we are adding another £70 cost for shipping on top of that.

"We would feel as a small company that it would be morally and ethically wrong to go to a customer and say that chair is now up £70," he told BBC News NI.

Thousands of containers pass through Northern Ireland's ports every week, carrying components for manufacturing or products to sell to consumers.

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Mr Dynes told BBC News NI he was looking to other markets to meet the needs of his business and customers.

"At the minute we have three containers sitting in Asia and we are not going to ship those. We can buy smaller quantities in Europe and the costs haven't changed.

"It's a worldwide crisis. I don't like using the word 'crisis' because it makes people nervous," he said.

Seamus Leheny from Logistics UK told BBC Radio Ulster's Good Morning Ulster programme that it could be next year before costs begin to fall.

"This is right across the board and is affecting not just imports from the Far East, which we really rely on, but also exports," he said.

"Imports from China have seen rates increase from anything between 500 and 800%. In terms of exports, one local business told me recently that they've seen their rates to the USA increase by 600%."

The Covid-19 pandemic had an impact on consumer demand, which in turn affected shipping fleets

Mr Leheny said it was a supply and demand issue because of a "reduced capacity coming in from the Far East".

"There are fewer ships and those coming in are full, so the carriers are charging more for this," he explained.

He also said there were problems with congestion at ports.

"Ten years ago there were 20 shipping companies shipping from the Far East into Europe. Today we have about seven due to consolidation so there is less competition on the market.

"The pandemic has had an impact as demand fell off very quickly in 2020 with economies closing down and when they reopened, the ports in Far East were congested and the ships were on reduced capacity.

"The costs cannot be absorbed by the shipping agents.

"This ultimately will affect consumers."