European shippers oppose congestion surcharges

The ESC said surcharges imposed by ocean carriers due to port congestion on the West Coast are unacceptable.    The European Shippers Council says congestion surcharges being imposed by carriers are “unacceptable.”
   The ESC said it sees “no reason to impose these congestion surcharges, urges ship owners to minimize surcharges and bring all costs into a single negotiable freight rate wherever possible.”
   Shippers “have been faced with the introduction of congestion surcharges in several parts of the world, among them Oman, the Philippines, India, the United States, Hong Kong and the Netherlands,” the organization said.
   It continued, “According to operators this mechanism is ‘necessary’ due to the new organization of the ship owner through alliances, VSA, slot exchanges and other means of rationalization.” The ESC added that rationalization was been presented to shippers and competition authorities as a means “to improve the service quality offered to customers. Not to increase revenues by creating new surcharges.”
   Carriers should “limit the impact of these new organization models by solving problems rather to impose surcharges to shippers. Moreover, operators should minimize surcharges and bring all costs into a single negotiable freight rate wherever possible. This would provide more transparency and predictability to the partnership with the customer,” said ESC.
   Despite the ESC’s statement, carriers have pointed to other reasons for implementing surcharges.
   The Transpacific Stabilization Agreement, a discussion agreement for 15 container carriers, on Nov. 14 pointed to “labor-related terminal delays” on the West Coast as the reason its members were implementing surcharges.
   After shippers in the U.S. and the Federal Maritime Commission raised questions about those surcharges, which, in some cases, carriers planned to impose on cargo already in transit, many carriers withdrew their surcharges. Since then, many carriers have announced they will go ahead with the surcharges — which often amount to $1,000 per FEU — on cargo tendered as of Nov. 26.
   The forwarder Mallory Alexander says it has now seen notices from 11 carriers planning to impose port=congestion surcharges. It has compiled a summary of those charges in a chart on its website.