Carrier tells ag shippers to accept surcharges, free time penalties
An ocean carrier official Friday told agricultural shippers that fuel surcharges and detention and demurrage rates are not temporary, but rather a necessary way for carriers to recover rising costs.
“We’re all taking it on the chin with fuel,” said Ed Zaninelli, vice president of transpacific westbound trade for OOCL, at the annual meeting of the Agriculture Ocean Transportation Coalition in San Francisco. “Inland fuel surcharges (for inland port intermodal moves) are huge too, so it’s not just bunker.”
He said agriculture shippers are more accepting of the surcharges than corporate shippers.
“This industry is more fair than some of the larger corporations,” he said. “There you have some guy at the top saying, ‘No, we’re not going to pay that.’ “
With many shippers in attendance decrying the diminution of demurrage and detention periods, Zaninelli said shippers must realize that reduced free time in rail and marine terminals is a cultural change they will have to embrace in order for American ports to handle the cargo growth expected over the next few years.
“Punitive detention and demurrage is a way of life now,” he said. “We can’t keep writing things off. We’ve got to keep things moving.”
Zaninelli also said that shippers who are experiencing the pinch of trying to diminish inventory in transit should talk to shippers about effectively using transshipment ports.
“You should consider transshipment hubs overseas,” he said. “If you have a commodity that can store, think about using a hub.”
Storing commodities in strategically based transshipment ports allows shippers flexibility in when to bring their cargo to certain markets.