News / Australian forwarders seek aid as surcharges and ‘dumped’ boxes drive costs up

Photo: © Yong hian Lim

Australian forwarders are on the hunt for government assistance to mitigate surging shipping costs provoked by the US/Israeli war against Iran, and urging some resolution to carriers hitting forwarders with unexpected end-of-voyage charges.

Alongside the Australian Peak Shippers Association (APSA), the Freight & Trade Alliance (FTA) warned that a combination of war-induced surcharges were adding as much as A$5,700 ($4,000) in costs for every container shipped.

Noting that these charges were “often imposed without notice and after the cargo has already been handed over,” APSA secretariat and director of the FTA Paul Zalai said that “businesses have no leverage”.

Mr Zalai added: “They are being forced to absorb charges they didn’t agree to, can’t verify, and simply can’t avoid. This is a perfect storm of global disruption and market imbalance with Australian exporters are wearing the cost.”

In a joint letter to prime minister Anthony Albanese, the FTA and APSA called for “targeted financial assistance for Australian exporters to offset emergency conflict, war risk and deviation surcharges,” noting costs would “inevitably” be borne by Australian consumers.

Echoing concerns raised by other forwarders The Loadstar has spoken to, Mr Zalai pointed out carriers were increasingly invoking end-of-voyage declarations, shifting “responsibility mid transit, leaving exporters exposed to recovery, storage, and rehandling costs”.

Multiple forwarders told The Loadstar they have had boxes “dumped anywhere” as container lines look to deal with the fallout of the latest conflict in the Middle East, with an instance of Dubai-bound boxes being left in Qingdao at the start of a rotation.

One forwarder said: “Carriers are literally pulling into any port and offloading cargo, with it left up to us to work out how to get the cargo to its final destination. This is resulting in loads of additional costs being dumped on us too.

“There is the fee we are charged for the unloading, then they are also hitting us with storage charges. They can drop these boxes anywhere they want, and are, and they are offering us no support – often not even telling us until the container has been unloaded.”

An end-of-voyage advisory – which kickstarts the process of carriers searching for a safe port – sent out by MSC, seen by The Loadstar, informed customers that they would be charged $800 ‘per box unloaded’, with further charges applied for storage.

The FTA warned that this practice was proving particularly costly for the country’s perishable goods economy, noting that “delays and diversions can result in total product loss,” with its $2bn livestock export business to Africa and the Middle East “being severely disrupted”.

Chief executive of Australian Horticulture Trade, Lesley Shield, said: “Growers and exporters have been severely affected by this conflict. It has added significant costs to the supply chain, potentially leading to them being less competitive in already extremely competitive markets.”

Mr Zalai urged a “whole-of-government” response, pointing to growing belief that key maritime routes are likely to be impacted for a “significant period,” stressing support from government should “reflect the scale and duration… and broader implications for Australian trade”.