Sliding seafreight rates and weak sterling are complicating the picture for UK importers.

Bunker adjustment factor (BAF) rates have fallen considerably from their high in the second quarter of the year as oil prices have slumped - giving some respite to importers.

But Brian Madderson of stevedore George Hammond plc warns that firms that did not hedge currency when sterling was high against the dollar may be financially exposed as the pound trades at $1.60 this week. He said: “A lot of serious importers do hedge, but they might not have hedged as much or for as long this year when sterling was at $2.02 and pundits were forecasting it could go as high as $2.10. They will now be feeling the pinch and will find it very hard to get distress payments out of retailers.”

Shippers out of Central America working dollar bananas and paying dollar freight rates on conventional reefer vessels might find themselves particularly affected. Madderson forecasts gains for ACP suppliers working in euros. “Out of West Africa, it is not just Cameroon and Côte D’Ivoire shipping bananas to Europe but also Ghana, and these countries are also shipping MD2 pineapples, so that could buoy things up,” he said, adding that the collapse in world trade is also leading to good deals on containerised shipping.

In major sources such as Brazil, Chile and South Africa, currencies are softening against the dollar, while sendings from China are struggling as its currency’s value remains strong.

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