From the Editor
Luis Ayala
When you supply bulk rum to clients around the world (like we do), you have to be keenly aware of all the hurdles the rum will face on its way to the client/bottler, such that the freight-related expenses are minimized. This allows the final consumers to purchase the bottled goods at the lowest possible prices, which makes excellent business sense.
During the Covid pandemic, the ocean freight industry was turned upside down, with certain routes facing unprecedented traffic increases while other routes were left without containers and shipping vessels. Leading ocean freight companies responded by ordering the construction of additional/larger ships, many of which are now entering service. While the net transportation capacity is now larger, and despite the fact that many of these companies are now billing at below their operating expenses, other factors are now affecting prices and availability:
- The conflict between Ukraine and Russia
- The conflict between Israel and Hammas
- The European Emissions Trading System (EU ETS)
- IMO 2023 requirement to decrease steaming, slowing down average ship speeds from 16.5 to 15 knots
- Panama Canal traffic restrictions (due to low water levels)
- Suez Canal traffic impacted by Houthi rebels
- Ships having to navigate around the Cape of Good Hope
So, while the overall shipping/container capacity has increased, this has not always resulted in lower (closer to pre-pandemic) rates being experienced by most consumers around the world. In many cases quite the opposite is true, with supply-chain transportation costs continuing their upward trend.
To tackle this situation, some craft distillers are buying back empty bottles from their local consumers/bars, so they can properly clean and fill them before putting them back in use. I hope that the general public will react positively towards purchasing spirits in these bottles, encouraging many more distillers to do the same.
Cheers!
Luis Ayala, Editor and Publisher
http://www.linkedin.com/in/rumconsultant