The Cost of Fuel is Changing Globalization

The New York Times has a good article on how the rise of fuel prices is changing globalization.

The cost of shipping a 40-foot container from Shanghai to the United States has risen to $8,000, compared with $3,000 early in the decade, according to a recent study of transportation costs. Big container ships, the pack mules of the 21st-century economy, have shaved their top speed by nearly 20 percent to save on fuel costs, substantially slowing shipping times.

It’s odd but I noticed the other day when I went into Dollarama to buy some cheap locks for the lockers at work that stock was surprisingly sparse and I assume that a busier than predicted summer combined with slower shipping times equals distribution problems for retailers. As the article says, this could mean the end of just in time shipping as we know it and back to the idea of neighborhood warehouses. I guess this means that we can kiss fresh avocados in February goodbye around here.

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