Prices of smartphones, refrigerators and air-conditioners are expected to increase by 5-6 percent from upcoming month while in January-February next year price hikes is also expected to increase because of 10-12 percent rise in input cost.
According to industry insiders, freight rates have eased from the peak and container availability has improved for India’s exporters and importers of apparel and agricultural commodities to consumer electronics, but high input costs could force them to increase prices in the coming months.
Freight cost has cooled 5-15 percent, depending on the destination, from the peak of $10,000-12,000 in August for carrying a container from or onwards to India. While this is still high compared with $3,000-4,000 at the beginning of the year, exporters expect the easing of prices and the improvement in container availability to help further boost India’s exports, which rose 43 percent in October to $35.65 billion.
Consumer electronic companies, which are among the largest importers of components, said shipping and air freight rates from China and Hong Kong have come down by about 10-15% from the peak in August. Container rates are now varying between $6,000 and $6,500 from China, compared with $7,000 even a month back. Air freight from Hong Kong is down to HK$36-37 a kg from HK$44-45.
Further, apparel exporters are renegotiating rates with big brands to pass on higher cost. Rising yarn prices are bothering the apparel industry. It has gone up by more than 60 percent in the last one year. Accordingly, manufacturers have to increase prices of their products, but are not sure whether buyers will accept it.