According to an analysis by the International Monetary Fund (IMF), the rise in shipping costs in 2021 could increase inflation by about 1.5 percentage points in 2022.

“Looking at data from 143 countries over the past 30 years, we find that shipping costs are a major driver of inflation around the world: When freight rates double, inflation rises by about 0.7 percentage point,” the report said."Most importantly, the effects are quite persistent, peaking after a year and lasting up to 18 months."

While the pass-through to inflation is less than fuel or food prices — which account for a larger share of consumer purchases — shipping costs are much more volatile, say Yan Carrière-Swallow, Pragyan Deb, Davide Furceri, Daniel Jiménez and Jonathan D. Ostry in their analysis. "As a result, the contribution to the variation in inflation due to changes in global shipping price is quantitatively comparable to the variation generated by shocks in global oil and food prices."

The study also shows that higher shipping costs within two months dock the prices of imported goods, quickly spilling over into producer prices — many of whom rely on imported inputs to manufacture their goods. “But the impact on the prices consumers pay at the checkout is increasing more gradually, reaching its peak after 12 months. This is a much slower process than what is seen following a rise in global oil prices, which drivers feel inside at the pump. . a few months."

The inflationary effect of shipping costs will increase through the end of 2022, the report said. “This will create complicated trade-offs for many central bankers dealing with rising inflation and still plenty of slack in economic activity.” In addition, the war in Ukraine is likely to lead to further disruptions to supply chains, allowing global shipping costs – and their inflationary effects – to remain higher for longer.