News / Rising costs of port congestion force surcharge by Asian feeder operators

Port of Singapore. Photo: Steve Lovegrove | Dreamstime.com

Asian feeder operators have imposed a surcharge to cover rising costs that they are blaming on port congestion.

The Asian Feeder Discussion Group (AFDG) placed a notice in Singapore’s Business Times on 19 April, saying that since Monday, its members had implemented an ’emergency cost recovery surcharge’ to counter the rising operating costs brought on by port congestion.

The surcharge, on one-way basis, is $40 per teu for Singapore to Jakarta, Belawan, Semarang, Palembang, Surabaya, Cambodia, Malaysia, Ho Chi Minh City, Songkhla and Laem Chabang; $75/teu from Singapore to Bangkok, Danang and the Philippines; and $100/teu from Singapore to Karachi, Chittagong, Hai Phong and West Asia.

Shippers have to pay half the surcharge for empty containers.

AFDG said: “Our members, have over the past week, implemented various contingency plans, including multiple omissions, speeding up of vessels, to protect schedule integrity and maintain adequate service coverage. While managing the current situation the best [way] possible, our members have experienced a significant increase in overall operational costs.”

The surcharge remain until further notice.

And port congestion returned to Chinese ports this month, with berthing delays across all major regions across Bohai Rim, Yangtze and Pearl River Delta ports, according to consultancy Linerlytica. As ships re-route round the Cape of Good Hope, some Asian ports, such as Singapore and Port Klang, are also seeing longer vessel queues.

Linerlytica said: “Vessel bunching and poor weather conditions have resulted in longer waiting times at Qingdao, Ningbo and Shanghai, with delays of up to two days. South-east Asian ports have also seen increased congestion, with Singapore, Tanjung Pelepas and Port Klang experiencing delays of one to two days.”

However, as of Monday, port congestion stood at 1.46m teu, down marginally from last week, with a reduction in delays across all main Asian ports. Overall congestion was down by some 250,000 teu, compared with a year ago.