LOW RATES = INCREASED SURCHARGES

July, 2016

SurchargesOcean carriage rates are at new lows, and surcharges are at new highs…CAF, FAF, EBAF, THC, Chassis Usage, Documentation, Peak Season, Pier Pass, Congestion, Extended Hours, Delay, Per Diem, Demurrage, just to name a few. The number of itemized charges are on the rise as are the quantum of the individual charges.

The fact of the matter is ocean carrier base rates, and trucker base rates, have been so squeezed that any additional service, new expense, or hiccup in the chain of events causing delays or inconveniences by carriers will result in an extra charge…a surcharge.

Who’s to blame? The consumer. That’s where it all starts, after all. Baby boomers grew up knowing prices only went up year after year. Inflation was a fact of life, plain and simple. But, no more. That reversal, whereby consumers expect to pay less year after year, can be accomplished only by squeezing EVERY element of the supply chain…all the way down to the chain’s last element, the truck driver. It has been going on for years, and the transportation sector is tapped out. The pendulum is swinging, however, and that truck driver is pushing back, hard. Base rates and itemization are on the rise. Stay tuned.