The global freight price pain of the past two years is easing, but farm sector exporters and importers should not expect a return to pre-pandemic rates - in fact they may rise again in the coming year.
The message on fuel prices is similar, with Rabobank warning farm diesel costs will likely be climbing by year's end.
In fact, high fuel prices, ongoing labour shortages and environmental pressures were among the contributors set to keep Australian import and export sea freight costs well above 2019 levels.
Pressure from a creeping rise in the Australian dollar could also add to our global farm trade challenges.
The agribusiness banker tips our dollar at US75 cents by December, although at first it may be more export-friendly with a mid-year decline from recent strengths around US70c.
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On a global average, the coronavirus pandemic's legendary logistics bottlenecks sent shipping container freight rates leaping five-fold in 2021, according to Rabobank's research head, Stefan Vogel.
On-time arrivals slumped from 80 per cent to 40pc, exacerbated by delayed upcountry container movements to and from ports around the globe, which, in turn, kept ships anchored for longer and doing less sailing.
The worldwide log jam began easing by the second quarter of 2022, with freight rates for dry container goods falling swiftly on routes between Europe, the US and China as the year progressed.
However, Mr Vogel said Australia was still missing out on the full extent of those freight price corrections.
Traders were not getting the sort of reductions seen on more popular routes to and from China, although fortunately the cost of moving containerised machinery, chemicals, fertiliser, cotton, grain, wool and other farm sector materials was well down on two years ago.
Cold comfort
Less fortunate, however, were exporters of perishable horticultural, seafood and meat products who relied on refrigerated container space.
He said anecdotal evidence suggested refrigerated freight costs had declined "in the ballpark of only about half as much" and any further declines would likely be slow because of container shortages in agricultural export regions.
Overall, container freight still averaged at 30pc to 40pc more expensive than in 2019, despite the freed up supply chains, a slowing global appetite for consumer goods and extra shipping vessels being built to service exporters.
"We still don't think freight rates will return to where they were," Mr Vogel said.
Even with the prospect of fleets of new shipping container vessels being launched in the next 18 months, Rabobank was tipping container rates were now "nearing the bottom of the downturn".
Newly launched ships would replace ageing, less efficient vessels overdue for the scrapyard.
In the bank's agribusiness outlook for 2023, its international analysts have surmised that ocean carriers were in strong financial and strategic positions, "working towards a new equilibrium where shipping rates will be higher than pre-pandemic levels as operating costs rise".
Those operating costs included not just rising bunker fuel oil, but environmental pressures on shippers to use more expensive, but environmentally-friendlier low sulphur diesel, particularly when operating near coastlines and ports.
"Ships now carry two different fuel types on certain routes," Mr Vogel said.
Diesel shortage
Meanwhile, down on the farm diesel prices continued to feel the pressure of low global stocks, bans on warring Russia's refined fuel exports, tight OPEC oil price controls, and a global shortage of diesel refining capacity.
"We don't have a forecast on refining capacity, but prices remain elevated compared to pre-COVID and it seems likely farmers will have to bank on them trending higher than they have been historically," Mr Vogel said.
For the moment Europe's warmer than normal winter had calmed energy markets, pushing Australian capital city diesel pump prices lower from December's range between $2.05 cents a litre in Perth to $2.30c/litre in Darwin, to a current spread between $1.90c/litre and $2.16c/litre.
However, Rabobank expected values at least as high as today by year's end when the next northern hemisphere winter would drive energy demand.
Brent crude oil was tipped to jump from an average $US88 a barrel in the current quarter to average $US93 by year's end.
Analyst Pia Piggott noted the US diesel inventory was at a 30-year low and investment in refinery upgrades or expansion was lagging and constraining capacity.
She said the scene was set for a structurally constrained global fuel market in 2023.
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