Carriers Announce Disruption Surcharges for USEC Cargo as Strike Looms October 1

19/09/2024

As the possibility of an October 1 Strike action at Ports on the US East and Gulf Coasts draws nearer by the day, container shipping lines serving the region have begun to announce disruption surcharges.

On 1 September, MSC notified customers it would apply a $1,000 per 20ft and $1,500 per 40ft Emergency Operations Surcharge (EOS) from 1 October (the date set for the strike to begin) on all shipments from Europe to the US east and Gulf coasts, as well as to ports in the Caribbean, Mexico and Canada.

Under US Federal Maritime Regulations, new price hikes and surcharges must be notified to the trade at least 30 days before implementation.

That was followed by a CMA CGM advice that US East and Gulf Coast local port charges for import shipments of $1,500 per teu would be applied from 11 October, while export shipments would be subject to local port charges of $800 per 20ft and $1,000 per 40ft on the same date. The French carrier has also advised customers that it would apply a $500 per teu rate ‘restoration initiative’ on all transatlantic shipments from 1 October.

Today Hapag-Lloyd became the latest carrier to announce a port strike surcharge, revealing it would apply a Work Disruption Surcharge of $1,000 per teu from 18 October on container shipments to the US east and Gulf coasts in the event of a strike.

“For vessels that arrive at the US east coast in the first week of October and get stuck there, it will be five-to-seven weeks before their absence is missed in Asia, and if we get a lengthy strike it will have a major impact in Asia as we begin the pre-Chinese New Year rush,” he said, adding that the pandemic experience had taught carriers valuable lessons on pricing in such situations.

Meanwhile, for US exporters, new analysis from supply chain visibility platform FourKites suggests the automotive and agricultural verticals in the US would be the most vulnerable to an extended strike, possibly leading to 1) increased food prices in countries that rely heavily on American produce, 2) potentially leading to auto production slowdowns or even temporary plant closures, and 3) also lead to inventory shortages, potentially impacting holiday shopping seasons and year-end manufacturing targets,” he added.