The decline in exports and production rates is also hampering the country’s job security, as per South Korean media reports.

Decline in global freight prices is severely affecting South Korea’s global order outlook, a country which heavily depends on overseas trade and 99 per cent of which is done by ship. The country is expected to have 43 per cent fewer global orders in 2023 than in 2022, according to an Export-Import Bank of Korea (KEXIM) report released last month.

The Shanghai Containerized Freight Index (SCFI), which is one of the most widely used indices for ocean freight rates, fell 16.2 points from December 16, 2022, to 1107.09 on December 23, 2022. The latter figure is its lowest since July 31, 2020, when the index fell to 1103.47.

South Korea recently unveiled its maiden container freight index to better reflect shipping rates on Asian routes, according to its oceans and fisheries ministry, which said the Korea Ocean Business Corporation (KOBC) Container Composite Index (KCCI) stood at 2,892 for the second week of November.

The ministry collaborated with the state-run KOBC in July 2020 to develop KCCI to better tackle rising uncertainties from global supply chain disruptions.

Fibre2Fashion News Desk (DP)