“Buen Fin,” Christmas Gifts in DangerBy Sofía Hanna | Wed, 09/29/2021 - 12:16
The shortage in the production of electronic devices, the lack of containers, reduced activity in critical ports for international trade and the increase in the cost of international freight by up to 300 percent could cause a shortage of products for major gift-giving holidays, warns Drip Capital Mexico.
Major gift-giving events such as “El Buen Fin,” Christmas and the Wise Men celebration, could be affected by shortages of electronic products, toys and clothing, according to T21. The reasons behind the potential shortages are numerous. The production of electrical appliances, computers, cellphones, laptops and video games was affected by a shortage of semiconductors caused by the high demand for tech products during the COVID-19 pandemic. Semiconductor shortages have wreaked havoc in the automotive and electrical appliances industry and could cost the auto industry up to US$110 million in revenue during 2021. The potential shortage of products from Asia could also lead to “the proliferation of informal secondary markets, dedicated to reselling these goods at a premium and second-hand,” said Gregorio Vázquez, Commercial Director of Drip Capital Mexico, told T21.
MBN previously reported that the freight all kinds (FAK) rate for the Asia-US maritime corridor had increased several times during 2021, reaching at one point a 600 percent year-on-year increase. The lack of containers that has been occurring since mid-2020 disrupted various industrial sectors and hurt delivery times and logistics planning. For now, this shortage is expected to be overcome by 2022.
Drip Capital, a Drip risk assessment platform, urged Mexican import companies to “take precautions when placing orders to meet the demand of high seasons,” because of the potential saturation of freight routes.