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Things looking up do not mean rates coming down

It is no relief for shippers despite improvements at Yantian port

Maersk issued a notice on its website to announce there are improvements in Yantian port’s operations. However, nowhere in its advisory mentioned rebates. The carrier seems unfazed by complaints in the marketplace though none are named.

Shippers’ wrath over questionable rates
Last few weeks were draining for several shippers; held ransom by the carriers’ soaring surcharges. What made things worse were the revelations of unmoved boxes despite having paid for the exorbitant fees. Some shippers were fortunate enough to get their boxes delivered using smaller vessels as reflected by recorded growth in Baltic Dry Indices.

Port congestions leading to delays resulted in carriers conveniently passing the buck to shippers. Some media learnt customers were charged thousands of dollars without knowing why. Global Shippers’ Forum Executive James Hookham, questioned the carriers’ opacity. He stressed, “We need visibility of what these costs are. We accept the principle [behind the charges] but it is visibility, and honesty in some cases that is the problem. The system is opaque, and what if the vessel is late?” He added shippers could not understand what they were being charged for as they got 10 days’ free storage time. A survey revealed detention and demurrage charges (D&D) in the world’s 20 largest ports increased 104 per cent in 2021 compared with 2020 – amounting to an average of $666 per container.

Adding insult to injury, Matthew Hill, Head of Maersk North Americas Import business encouraged retailers to stockpile. He commented: “JIT is not sustainable these days. JIC supply chain models with inventory buffer ensure sales demand can be fulfilled. Customers are trusting us with a wider part of their supply chain to focus more on shipment level performance instead of container level.” This is on top of reports of Asian and European shippers having no idea of their boxes’ location. Stockpiling is independent of carriers’ shipment performance; presenting more risks to retailers selling perishables. At this current economic climate, no businesses risk inventory and hope they sell. It is the retailers who would be dealing with losses from unsold goods and wastage.

 

Marine Online News Team
Please email us at marketing@marineonline.com to contact the author for this article.

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