Covid care devices face bigger shortage, rate hike

There may be an even bigger shortage over the next seven days in critical Covid home care equipment, especially oxygen concentrators and pulse oximeters, that are largely imported from China.Companies and importers are saying most cargo flights from China and Hong Kong to India are getting cancelled at the last moment delaying the arrival of their ready-to-ship consignments.Among reasons for cargo flight disruptions are, as per Indian suppliers, attempts at price gouging by Chinese logistics and manufacturing companies as well as the basic economics of cargo flights – most return flights to China are going empty as many businesses that export products to China are shut. 82319941Industry expects supply shortage to ease after China’s long Labour Day holiday period – May 1 to May 5 – ends but somewhat higher supplies will be accompanied by much higher prices.Chinese manufacturers are hiking prices citing shortage in component supplies in the last couple of days. Prices of oxygen concentrators, which cost between Rs 40,000 and Rs 60,000 – will go up by Rs 8,000-15,000 from next week, while the price of pulse oximeters will likely almost double.Currently, many cargo flight cancellations have resulted in freight rates more than doubling. Logistic companies are renegotiating already-signed contracts.“We were supposed to get a few thousand units of oxygen concentrators from Hong Kong but the flight was cancelled at the last moment on Wednesday night. We hear from others that this is happening very frequently and logistic rates have suddenly shot up,” said Sanjay Kalirona, CEO at Gizmore. “If we have to reroute through other countries, it will be a significant cost escalation,” said Kalirona.Some Indian importers and companies allege that Chinese logistics and manufacturers are forming cartels to cancel or delay cargo flights to make more money. BPL Medical Technologies chief executive officer Sunil Khurana said logistic companies are demanding new freight rates even for existing orders.“We fear these are done by opportunistic logistic agents in China who are trying to create a shortage scenario by cancelling flights at the last moment to jack up prices. This raise in air freight will certainly impact adversely the end-user price. However we will try our best not to pass on the full impact,” he said.

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