International Freight Cost Increase Further Encouraging Domestic Production

A story in Monday's New York Times reports that the cost of marine freight are again increasing as the global economy recovers. This trend is a recovery of a trend that ACEEE noted in the last half of the past decade. Part of this trend is competition for capacity, but much results from infrastructure constraints at US ports that increase the cost and delay imports into the U.S. As we saw in the last decade, when freight becomes a constraint, manufacturers are motivated to move production to the U.S. for both finished goods, but also for components that are key elements of the supply chain.

So in spite of indications of some softening in manufacturing data suggest continuing indications that the manufacturing sector is poised for reinvestment.