Carriers Reinstate Surcharge

 In Breaking News, Industry Insider, Trans-Border Global Freight Systems, Inc.

Amidst Delayed ILWU/PMA Labor Talks

Despite multiple attempts from the Pacific Maritime Association (PMA) to convince the International Longshore Warehouse Union (ILWU) to resume negotiations, the ILWU has postponed talks until December 2, 2014. During this time, the union will be participating in subcommittee negotiations dealing mostly with local issues. As a result of working six months without a contract, strategic work slowdowns have begun crippling US West Coast trade and driving up carrier costs.

After some initial mixed messages, carriers in the Trans-Pacific market have made the decision to reinstate the port congestion surcharge (PCS).  PCS will apply to all cargo that is in-gated at origin on or after November 26, 2014.

Port congestion fees are as follows:

  • $800/20’
  • $1000/40’
  • $1125/40’ HC
  • Up to $25 w/m for LCL cargo

In anticipation of other Trans-Pacific carriers formally announcing their port congestion surcharges, the Federal Maritime Commission (FMC) is currently reviewing a number of concerns into PCS validity:

  1. Carriers are still not compliant with the 30-day advance notice requirement for tariff increases.
  2. Vagueness of the application of surcharges.
  3. The significant value of the surcharge, which does not appear to correspond to carrier cost increases.

We will continue to monitor the situation and provide updates as additional information becomes available.