Sufficient capacity is needed

CLECAT and FIATA recognise that demand for shipments from Europe to the Far East has increased. However, the question arises whether the current situation of insufficient capacity can be explained merely by higher demand.

“We witness an increase of vessels being taken out of circulation, which in our opinion contradicts the current increase in demand. On some routes shipping lines only accept bookings for sailings as far away as in four weeks’ time. Furthermore, it has been extremely difficult for the industry to deal with blank sailings”, said Mr Jens Roemer, Chairman of the FIATA WG Sea.

FIATA and CLECAT emphasise the importance of ocean carriers in the global supply chains and are aware of the difficulties their industry is facing. However, in order to prevent long-lasting damage to trade CLECAT and FIATA urge carriers to do all that is possible to guarantee sufficient capacity to traders.

Ongoing contracts and agreements should be respected

A number of carriers announced a Peak Season Recovery Surcharge (PRS) last week on cargo moving from Europe to the Far East. These separate announcements all appeared within a matter of days.

FIATA and CLECAT cannot silently absorb shipping lines now trying to apply the new PRS for shipments booked subject to tariffs and agreements valid at the time of booking. Ongoing contracts and fixed agreements should be respected in order to keep sustainable relationships in the supply chain.

Furthermore, CLECAT and FIATA question whether the PRS can justifiably be classified as a surcharge at all. Surcharges by definition relate to sudden changes in variable costs incurred by carriers, such as bunker prices, port congestion and currency fluctuations. FIATA and CLECAT question whether such changes in the variable external costs have actually occurred in this situation.

This is unfortunately not the first time that FIATA has to reflect on questions raised by surcharges, the general principle of which was already discussed in a Press Release published in November 2014.

This is mirrored in CLECAT’s Press Release published in January 2015, where Nicolette van der Jagt, CLECAT’s Director General, said: “Today the issue of surcharges continues to raise questions with many shippers and freight forwarders.”