Subscribe to our free, weekly email newsletter!


Agricultural shippers face added container chassis expense

CL, CMA-CGM, Cosco, Evergreen, Hanjin, Maersk, NYK and OOCL have announced plans to no longer provide chassis, the letter stated.
By Patrick Burnson, Executive Editor
September 09, 2010

In a letter sent to shippers today, the Agriculture Transportation Coalition (AgTC), said several major ocean carriers will no longer be providing container chassis.

CL, CMA-CGM, Cosco, Evergreen, Hanjin, Maersk, NYK and OOCL have announced plans to no longer provide chassis, the letter stated.

“NYK had announced an effective date of September 1, 2010, but this has postponed this,” said AgTC spokesmen.

According to the AgTC, Maersk has announced October 4, 2010 as the date for divestment of chassis at California’s ports and rail yards:

“Henceforth, the truckers will have the choice to provide their own chassis, use customer-owned chassis, or rent the chassis from Direct ChassisLink, a Maersk affiliate for $11/day. Of course, the truckers will likely charge the cargo owners additional amounts to cover their own extra operational and administrative costs.”

The move should hardly come as a surprise to West Coast shippers, however, as they were warned of this development at last June’s AgTC annual conference in San Francisco.

AgTC spokesmen allowed that the lines “correctly point out” that the U.S is the only market in the world where ocean carriers provide the chassis, and that stricter safety and reporting requirements will drive costs up further.

“While carriers have said that carriers and shippers should work together to jointly reduce costs, this appears to be a fairly significant increase in shipper costs (and administrative burden), with no recognition of the impact by the carrier, and no sharing of the burden,” AgTC said, adding that essentially, this amounts to a unilateral rate increase.

“So the question becomes - if the carriers regularly impose surcharges on the basis that they have additional costs, such as for bunker fuel, for terminal handling, shouldn’t they provide a freight rate reduction now that they are shifting a significant cost from themselves to the shipper?”

So far, said the AgTC, such requests, even from major shippers, have been rejected.

About the Author

image
Patrick Burnson
Executive Editor

Patrick Burnson is executive editor for Logistics Management and Supply Chain Management Review magazines and web sites. Patrick is a widely-published writer and editor who has spent most of his career covering international trade, global logistics, and supply chain management. He lives and works in San Francisco, providing readers with a Pacific Rim perspective on industry trends and forecasts. You can reach him directly at .(JavaScript must be enabled to view this email address).


Subscribe to Logistics Management magazine

Subscribe today. It's FREE!
Get timely insider information that you can use to better manage your
entire logistics operation.
Start your FREE subscription today!

Recent Entries

As the calendar turns to September and we approach 2015’s final third, there are, as usual, many things that require our attention from a freight transportation, logistics, and supply chain perspective.

According to Panjiva data, July shipments-at 952,126-were up 1 percent over June, following sequential gains of 7 percent for May over April and 1 percent for June over May.

While the previous edition of the Shippers Conditions Index (SCI) from freight transportation consultancy FTR showed some encouraging signs for shippers in terms of a mild uptick in overall market conditions.

Supply Chain Expert John Caltagirone is working with an increasing number of large companies that need help addressing key issues that “keep them up at night.” Here’s what Caltagirone recommends supply chain managers do right now to prepare for the future.

What will it take to find, train, and retain talent going forward? Three supply chain experts dust off their crystal balls and discuss the top ways to build the workforce for 2025.

Article Topics

News · Freight · Truck · Railroad · Container · Transportation · All topics

Comments

Post a comment
Commenting is not available in this channel entry.


© Copyright 2015 Peerless Media LLC, a division of EH Publishing, Inc • 111 Speen Street, Ste 200, Framingham, MA 01701 USA