Overtime charges lose bunker business for SA

Leonard Neill A PROPOSAL from the bunkering industry in South Africa that overtime charges levied for fuel supplies drawn from pipelines be regulated on a set charge has been rejected by the fuel suppliers. This, say industry representatives, will have a detrimental effect on their operations and on shipping charges in South Africa as a whole. "South Africa has lost more than one million tons of bunkering business during the past three years for various reasons, and this latest move can only add to the decline," says a well placed industry source. "Costs to ship owners are rising steeply in this country, and encouraging them to take on bunkers elsewhere." The Association of Ship Agents and Brokers of South Africa (Asabosa) recently formed a bunkering committee to address the overtime charge situation. While barge operators don't charge for overtime deliveries, making it clear they are a 24 hour service, pipeline delivery fees are levied by fuel suppliers for overtime services, and have to be passed on to ship owners. These fees are levied by Joint Bunkering Services (JBS), an organisation established by the various fuel suppliers, whose charges vary for working day overtime, weekends and public holidays. "The decline in business during the last three years can be attributed to a host of reasons, involving delays in harbours, port costs, and the Pacific Rim economy collapse, as well as fuel stock shortages as a result of refinery fires and shutdowns for refurbishments in this country during the past 12 months," said the FTW source. "At the other end of the scale we have the situation where South America, which was a no-go area for bunker operations only a few years ago, has seen a remarkable turnabout with its ports now providing good quality fuel and service. "There is now strong competition within our own continent where ports like Mombasa, Dar es Salaam and Maputo are offering better service and turnaround times than our harbours. All of these ports are now hitting our business because of the cost-saving service they are providing. It's a difficult task telling a Far East ship owner that he has to pay overtime fees for a vessel that berthed at six in the morning but had to wait until after dark for his bunker supplies. He isn't interested in port delays, but we have to put up with them. "A few months ago the bunker committee investigated the situation and proposed a blanket connection fee of five US cents per metric ton for pipeline supplies at all hours, a figure that can be absorbed easily into the operational costs of all vessels, be they small fishing craft or big liners. But JBS has rejected this, stating this is not an appropriate time to change the situation. "It is quite clear that unless South Africa can put itself on a level where it can compete successfully with the international business world, we shouldn't complain when we start to lose business. And in the bunker industry we are doing just that!"