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  • Singapore Wholesale Sea Freight Prices Jump 25.4 per Cent

    Singapore Wholesale Sea Freight Prices Jump 25.4 per Cent

    Singapore transport and storage operators pushed wholesale charges higher in the second quarter, led by a 25.4 per cent quarterly surge in sea freight rates.

    Official producer price figures from the Department of Statistics released on Oct 28 confirm that wholesale freight forwarding costs rose 10.2 per cent over the same period, while postal and courier services climbed 7.1 per cent.

    The price increases hit wholesale markets after an index tracking imported fuels, lubricants and related materials spiked by nearly 79 per cent month-on-month in March. That energy shock followed the outbreak of the Iran war on Feb 28 and the effective closure of the Strait of Hormuz, an export channel that handled roughly 20 per cent of global oil and gas output. Although fuel import metrics eased later in the year, they settled well above their baseline levels.

    Uneven Impact Across Shipping Modes

    Liquid bulk and gas transport absorbed the steepest increases because of their structural dependence on Middle East transit lanes. Crude oil and liquefied natural gas carriers faced direct rerouting requirements, while container shipping lines operating predominantly outside the Persian Gulf recorded milder cost adjustments. Container operators still absorbed indirect pressure through pricier bunker fuel and schedule disruption across regional transshipment hubs.

    Air freight forwarding registered the sharpest immediate shock within forwarding segments. Air cargo handlers dealt with route deviations, constricted capacity and jet fuel premiums. Sea freight forwarders absorbed a combination of higher carrier spot rates, emergency bunker additions and war risk insurance surcharges, whereas domestic land freight forwarding pricing held steady through the period.

    Courier Adjustments and Domestic Storage

    International parcel delivery networks responded by adjusting their baseline tariffs. The 7.1 per cent increase in postal and courier indices stemmed entirely from cross-border traffic, while domestic Singapore delivery tariffs softened over the quarter. Global integrators operating regional sorting hubs in the city-state have passed energy expenses directly to corporate shippers.

    DHL Express has scheduled a general rate increase for January 2027, citing global energy costs and local operating conditions. Upstream handling fees in Singapore also crept higher during the second quarter, with cargo handling charges rising 2.7 per cent month-on-month and warehouse storage fees gaining 0.6 per cent.

    Pressure Mounts on Regional Supply Chains

    For consumer brands and cross-border merchants, wholesale transport cost hikes squeeze gross margins at the inbound inventory stage. Retail businesses often absorb wholesale freight spikes during the initial shipping cycle to defend unit volumes, but prolonged upstream inflation forces retail price tags higher once existing inventory depletes.

    Importers across Southeast Asia face two distinct operational choices. They can absorb degraded margins during upcoming peak sales quarters or pass freight surcharges into final shelf prices. E-commerce platforms that rely on international air parcels face the immediate prospect of higher threshold requirements for free shipping programs.

    The Pipeline of Upstream Costs

    Before the conflict escalated in February, liquid bulk freight tariffs fluctuated within narrow bands and container rates trended lower across major Pacific routes. That period of pricing relief ended abruptly once bunker fuel benchmarks tracked global crude upward. By Oct 23, Brent crude touched more than US$117 a barrel, its highest point since April, after strikes hit commercial tankers near the Strait of Hormuz.

    Commercial shippers now look to the third-quarter producer price indices and DHL Express’s scheduled tariff revision in January 2027 to gauge whether logistics operators will levy fresh baseline increases.

  • Singapore retail sales continue their strong post-Covid surge

    Singapore retail sales continue their strong post-Covid surge

    Takings at the till in Singapore grew faster in May, helped by a low year-ago base and the continued boost from tourist spending after travel restrictions were eased. Retail sales surged 17.8 percent year on year, extending the 12.1 percent growth in April, according to figures released by the Department of Statistics (SingStat) on Tuesday (July 5).

    This exceeded the expectations of analysts polled by Bloomberg, who projected sales to grow by 13.4 percent.

    Excluding motor vehicles, growth was even stronger, coming in at 22.6 percent.

    “The year-on-year increase in retail sales in May 2022 was mainly attributed to the low base in May 2021 when measures such as international travel restrictions were in place,” said SingStat in a press statement.

    Experts said this growth is expected to continue but might be moderated due to higher prices and inflation.

    RHB senior economist Barnabas Gan said: “The retail sales momentum will likely stay buoyed into the third quarter as Asia moves on from Covid-19-related fears. Tourism levels have been picking up across Asian economies, including Singapore.”

    He added that the tight labour market and reopening of Asia’s borders should support spending. “On the back of domestic demand and tourism-led spending, we think retail sales from an index perspective will likely return to pre-Covid levels by the end of this year,” he said.

    But the bright outlook might be muddied by any unexpected worsening of the Russia-Ukraine conflict and China’s economic slowdown, he noted.

    Maybank Kim Eng economist Lee Ju Ye added that the surge in inflation and rising mortgage rates will likely result in some belt tightening by consumers.

    “In particular, sales of discretionary items such as watches and jewellery and recreational goods may be the most affected,” she said.

    Consumers are also expected to lean towards lower-priced items as costs go up, added National University of Singapore business professor Lawrence Loh.

    “In the near term, retail may face a double whammy of moderation in demand and escalation of costs.”

    Within the retail trade sector, most industries recorded year-on-year growth in sales in May.

    Discretionary industries such as wearing apparel and footwear saw sales balloon by 98.2 per cent due to the low base in May 2021, when there was lower tourist spending due to travel curbs.

    Department stores, which were hard hit by Covid-19 restrictions, also saw sales jump by 73.1 per cent.

    This was followed by retailers of watches and jewellery, which recorded higher sales of 60.7 per cent.

    Retailers of food and alcohol saw sales rise by 47.3 per cent, while petrol service stations recorded sales increases of 45.8 per cent.

    In contrast, sales of motor vehicles fell 10.2 per cent.

    Supermarkets and hypermarkets recorded declines in sales of 10.3 per cent, while minimarts and convenience stores saw sales fall by 4.8 per cent.

    This was due to the higher demand for groceries in May 2021 when more people stayed home during the Phase 2 (Heightened Alert) period, SingStat noted.

    Meanwhile, the sales of food and beverage services grew by 40.1 per cent in May on a year-on-year basis, compared with the 11.6 per cent increase in April.

    “The significant growth in food and beverage sales in May 2022 was mainly attributed to the low base in May 2021, when Phase 2 (Heightened Alert) measures were in place, with dining in at food and beverage establishments not allowed for half of the month,” SingStat said.

  • Retail sales up 0.9% on-year in June, boosted by vehicle sales

    Retail sales up 0.9% on-year in June, boosted by vehicle sales

    Retail sales in Singapore rose 0.9 per cent in June compared with the previous year, mainly due to a jump in sales of motor vehicles, the Department of Statistics (SingStat) said on Monday (Aug 15).

    However, excluding motor vehicles, retail sales dipped 3.0 per cent compared with the same period a year ago.

    On a month-on-month basis, retail sales were down 1.5 per cent in June. Excluding motor vehicles, retail sales dropped 3.7 per cent.

    The total retail sales value in Juune was estimated at S$3.6 billion, similar to a year ago.

    Retailers of motor vehicles recorded a sales increase of 17.1 per cent compared to the previous year, the highest increase of all sectors. The next best performing sector was furniture and household equipment, which saw a 5.8 per cent increase. The medical goods and toiletries sector also recorded an increase of 3.0 per cent.

    Other than the mini-marts and convenience stores section, which was unchanged, all other sectors were in the red.

    According to SingStat, the telecommunications apparatus and computers sector fell the most at 25.1 per cent, compared with the previous year. This was followed by petrol service stations, which fell 14.1 per cent, and recreational goods, which saw a 11.8 per cent dip.

    Sales of food and beverage services rose 0.4 per cent from the previous year. The total sales value of food and beverage services in June was estimated at S$649 million, higher than the S$646 million in June 2015.

    The Retail Sales Index and the Food and Beverage Services Index measure the short-term performance of retail and F&B service industries based on their sales records. The sales figures exclude taxes such as GST and COE.

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