Box lines force D&D charges on near-bankrupt Afghan shippers caught in crossfire
Cross-border trading between Afghanistan and Pakistan, via the southwestern port of Karachi in Pakistan, has ...
This story has since been updated.
A US exporter was left furious after being contacted by a debt collector contracted to recover $3,200 in detention & demurrage (D&D) charges she says was never owed.
US shippers, exporters in particular, have complained to the Federal Maritime Commission of poor services during the pandemic, as capacity constraints on the water and restricted container availability inland saw D&D charges, as well as average freight rates, soar.
The shipper, Alice – not her real name but she fears reprisals from the line in question, believed the D&D claim was fraudulent, but after some discussion admitted it was more likely to be a lack of due care by the shipping line in question, Korea’s HMM.
“Before the pandemic, the shipping lines used to chase us exporters relentlessly, now they don’t want to know us, said Alice, who ships relatively low-value goods and has seen her freight rates rise “by a factor of six, from $225 to $1,400/feu.
Alice told The Loadstar she had received the HMM D&D invoice for $3,200 and had investigated. Given that her company’s total D&D bill for the whole of 2020 was in the region of $2,000, the charges appeared very high.
The Loadstar has seen the demand from the debt collector and the line’s original invoice.
Alice wrote to HMM to explaining that the company had been charged incorrectly and that her containers had entered the port within the given period before the estimated time of departure for the vessel.
She said she did not hear anything further for about a month, when she received the note from the debt collector with the original D&D charges, plus fees for the debt collector.
Alice said: “The vessel was delayed by about a week, and the line informed us after we had already turned in all of our loaded containers. And then they tried to charge us several days of demurrage, claiming we had exceeded our 10 days of free time. In reality, it was their vessel slippage that caused the additional time at the port.
“They chased us very hard,” Alice added. “The debt collector was very rude” when he tried to collect on the invoice”.
The export containers had been delivered on time to the US east coast port within the ‘free period’ before the vessel was slated to arrive. Once the boxes were in the terminal the shipper had no control over their movement, it was down to the shipping line which operates the ship and the terminal which handles cargo operations.
“Once the box is in the terminal there is nothing I can do about its loading,” explained Alice.
She said the last communication with HMM had been a letter she sent more than 10 days ago explaining her position again, with details of notifications and free time periods. HMM had, as of today, not responded to Alice’s letter.
“It is clear the line is at fault,” said Alice, “but it’s the first time a shipping line has chased me with a debt collector.” She added ruefully: “They’re already charging an arm and a leg, and now they want our knees too.”
Recently a Container xChange survey showed US D&D charges were among the world’s highest, with Los Angeles and Long Beach charging $196 and $173 per box on average last year. The next highest charges, at Hamburg and Rotterdam, were $65 and $53/box.
The Loadstar asked HMM for comment on the allegations, and they responded with the following statement: “HMM has not been informed of any specific information on this case, including shipper’s name, locations, container numbers, invoices, etc. We can barely comment at the moment without knowing detailed information at least concerning this case.
We are internally checking, but if we can procure more details on this matter, such as container number or invoice, it will be much easier for us to consider appropriate solutions.”
UPDATE: Since the publication of this story HMM have been in contact with Alice to apologise for their error and have cancelled all the charges in question. This matter is now closed.