Press Release
Shippers cry foul on surcharges
13 July 2005
The recent announcement by the Far Eastern Freight Conference of a Peak Season Surcharge (PSS) of USD 110 per TEU is like a “slap in the face for their customers” according to ESC's Secretary General Nicolette van der Jagt. “The fact that ships are full and that business is 'peaking' means that carriers are enjoying a period of high earnings and simply wanting more, while their customers struggle in an uncertain economic climate. A surcharge at such a moment seems to be very illogical and wholly unjustified.” The PSS will be applied with effect from 1st August 2005 until 31st October 2005 to all Westbound shipments from Asia. The PSS comes on top of the planned general rate increase of US$250/TEU and US$350/hi-cube scheduled for July.
Nicolette van der Jagt, added: “We have recently seen a set of opportunistic hikes in surcharges following fuel price increases ignoring normal competitive market pricing arrangements to the detriment of the customer. (See ESC press release “Shippers refuse to be fooled by Fuel Surcharges” 8/7/05) The list of surcharges is getting longer all the time with surcharges on bunker prices, port congestion, supply chain congestion, security, currency and now a peak season surcharge. We even see a surcharge 'to compensate carriers for the opportunity losses caused by the increasing incidence of heavy weight containers'! The carriers are using the present situation as an excuse to increase rates without considering how these increases would affect shippers.”
“Carriers have made the point that they would want to continue this practice even if the European Commission finally does away with liner shipping conferences.” Surcharges prove again that the way liner conferences act is completely out of touch with the realities of normal business practices or lack an appreciation of the needs of customers and their ability to pay. The ESC is looking forward to further actions of the European Commission which is presently reviewing the block exemption for liner shipping conferences enjoyed by carriers. Shippers expect the European Commission to outlaw the conference system and its joint action on surcharges.
For further information contact: Nicolette van der Jagt, Secretary General of the ESC - Brussels 00 322 230 2113
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