SINGAPORE: At family-owned store Hamad Traders in Little India, shelves are lined with dates from Saudi Arabia and Iran, chickpeas from the United Arab Emirates, and olive oil from Palestine.
Owner Ahmad Ramzani typically flies in shipments to Singapore every two weeks from various countries, as well as from a warehouse in Malaysia.
But with flights from the Middle East largely suspended due to the escalating war in the region, and the Strait of Hormuz - a key waterway - closed, timely deliveries are becoming increasingly uncertain.
Retailers are bracing for logistics costs of goods from the Middle East to rise by as much as 30 per cent as the United States-Israel conflict with Iran entered its sixth day on Thursday (Mar 5).
With the holy month of Ramadan driving up demand for certain items like dates, some importers like Mr Ramzani are banding together to manage higher costs and ensure supply, while others warn that consumers may eventually have to pay more.
Since the war broke out last weekend, Mr Ramzani said his logistics costs have gone up by 25 per cent, which he has absorbed so far.
Dates, which Muslims eat during their pre-dawn meals and to break their fast, are transported in refrigerated containers to keep them fresh.
However, major shipping lines have imposed war risk surcharges on cargo moving to and from the Middle East. These surcharges can reach up to S$5,000 (US$3,920) per container.
Observers say shifting trade routes could also lead to delays of up to 14 days.
To cope with this, Mr Ramzani has started pooling resources with other importers - sharing costs and risks - to bring in different types of dry fruits, nuts and dates. They first used this strategy during the COVID-19 pandemic.
"We realised because it was not possible for a single importer to import everything … we sat down and discussed: ‘Why don't we share one region? You import from other regions, I import them (from another). We bring in all the stuff here, then we share with each other’,” Mr Ramzani recounted.
Such sharing reduces investment risk for importers like him, he added.
An assortment of dates and dried fruit on sale.
Mr Aidil Hanafiah, another retailer whose dates come solely from Saudi Arabia, said he is working closely with suppliers to manage transport costs. Prices could rise by up to 30 per cent otherwise, he warned.
With peak demand during Ramadan, he is also concerned about stock levels.
"For example, there's no other way (to import goods) other than using the sea. Air flights are suspended. It keeps us worried about what's going to happen in the future,” added the managing director of Ideal’s Souq.
When Yemen's Houthi rebels escalated attacks on ships passing through the Red Sea during the Israel-Hamas war that broke out in 2023, shipments were similarly affected, said Mr Hanafiah.
The Suez Canal, a key trade route between Europe and Asia, lies at the northern end of the Red Sea.
“We had to wait for our items for an extra one week to 10 days,” Mr Hanafiah added.
A maritime expert said the movement of goods in and out of the Middle East is becoming increasingly challenging, especially as some shipping companies have stopped taking bookings.
Singapore’s ports may see more activity if the conflict continues, noted Mr Jayendu Krishna, director and head of maritime advisors at maritime research consultancy Drewry.
It will be “very, very challenging” to import goods via the Suez Canal, for instance, he said.
"Given the current situation, Iran is definitely not budging, and (United States President Donald) Trump is not budging from his position … It seems to me that this war is not finishing anytime soon,” he added.
“(This means a) probable scenario wherein you may see vessels starting to offload their boxes in Singapore, Port Klang or (other) transshipment hubs.”
Mr Krishna warned that if shipping companies offload more cargo than planned at such hubs, it could lead to congestion and further delays.
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Owner Ahmad Ramzani typically flies in shipments to Singapore every two weeks from various countries, as well as from a warehouse in Malaysia.
But with flights from the Middle East largely suspended due to the escalating war in the region, and the Strait of Hormuz - a key waterway - closed, timely deliveries are becoming increasingly uncertain.
Retailers are bracing for logistics costs of goods from the Middle East to rise by as much as 30 per cent as the United States-Israel conflict with Iran entered its sixth day on Thursday (Mar 5).
With the holy month of Ramadan driving up demand for certain items like dates, some importers like Mr Ramzani are banding together to manage higher costs and ensure supply, while others warn that consumers may eventually have to pay more.
HIGHER LOGISTICS COSTS
Since the war broke out last weekend, Mr Ramzani said his logistics costs have gone up by 25 per cent, which he has absorbed so far.
Dates, which Muslims eat during their pre-dawn meals and to break their fast, are transported in refrigerated containers to keep them fresh.
However, major shipping lines have imposed war risk surcharges on cargo moving to and from the Middle East. These surcharges can reach up to S$5,000 (US$3,920) per container.
Observers say shifting trade routes could also lead to delays of up to 14 days.
To cope with this, Mr Ramzani has started pooling resources with other importers - sharing costs and risks - to bring in different types of dry fruits, nuts and dates. They first used this strategy during the COVID-19 pandemic.
"We realised because it was not possible for a single importer to import everything … we sat down and discussed: ‘Why don't we share one region? You import from other regions, I import them (from another). We bring in all the stuff here, then we share with each other’,” Mr Ramzani recounted.
Such sharing reduces investment risk for importers like him, he added.
An assortment of dates and dried fruit on sale.
Mr Aidil Hanafiah, another retailer whose dates come solely from Saudi Arabia, said he is working closely with suppliers to manage transport costs. Prices could rise by up to 30 per cent otherwise, he warned.
With peak demand during Ramadan, he is also concerned about stock levels.
"For example, there's no other way (to import goods) other than using the sea. Air flights are suspended. It keeps us worried about what's going to happen in the future,” added the managing director of Ideal’s Souq.
When Yemen's Houthi rebels escalated attacks on ships passing through the Red Sea during the Israel-Hamas war that broke out in 2023, shipments were similarly affected, said Mr Hanafiah.
The Suez Canal, a key trade route between Europe and Asia, lies at the northern end of the Red Sea.
“We had to wait for our items for an extra one week to 10 days,” Mr Hanafiah added.
MOVEMENT OF GOODS MORE CHALLENGING
A maritime expert said the movement of goods in and out of the Middle East is becoming increasingly challenging, especially as some shipping companies have stopped taking bookings.
Singapore’s ports may see more activity if the conflict continues, noted Mr Jayendu Krishna, director and head of maritime advisors at maritime research consultancy Drewry.
It will be “very, very challenging” to import goods via the Suez Canal, for instance, he said.
"Given the current situation, Iran is definitely not budging, and (United States President Donald) Trump is not budging from his position … It seems to me that this war is not finishing anytime soon,” he added.
“(This means a) probable scenario wherein you may see vessels starting to offload their boxes in Singapore, Port Klang or (other) transshipment hubs.”
Mr Krishna warned that if shipping companies offload more cargo than planned at such hubs, it could lead to congestion and further delays.
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