“Prior to the vessel attacks in the Gulf of Aden, the cost of sending products by air was about £1.1 a kilo. That figure has reached £2.65 a kilo, say R. Sri Ram and Smruti Sriram, founders of reusable bag manufacturer Supreme Creations, a family business with its headquarters in London and manufacturing operations in India.
“Increase in logistics costs always hit consumers,” they add. Prior to the disruption, the company sent 70 per cent of its goods by sea, and 30 per cent by air. Today, all deliveries have switched to a sea/air combined method.
Besides the Dubai route, Sri Ram says other destinations, such as Kuwait or Bahrain, could also potentially work as air connections to Europe. He also points out that air cargo volumes have increased so much in Europe that airports are suffering from backlogs, adding another extra cost”.
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Photo credit: A crude oil tanker in the Suez Canal. Following recent attacks on vessels in the Gulf of Aden, Unctad estimates that transits through the canal are down by more than 40 per cent compared to their peak (Photo: Stringer/Bloomberg
