SA consignees pay the price for Chinese kickbacks

The biggest challenge that continues to face groupage operators on the China route is the issue of ever-increasing China rebates on prepaid cargo. According to Annelise Gunther, national sales manager for World Cargo Services, the South African consignee buying goods from China on a clearing and forwarding South African port basis ends up paying twice or even three times for his freight and China local charges, all of which get recovered from him against SA landside charges of one sort or another. “So why not buy ex-works or FOB China port one can ask. Well, it’s not always that easy, unless you know the supplier and his friendly local shipper is amenable. It’s amazing how issues of Chinese customs clearing, transport to port, or a host of CFS charges, can be used as a smokescreen for what is actually going on…someone in China is getting a kick-back and it’s not small. To secure full containers, most groupage operators take some prepaid cargo and simply recover these ever-increasing Chinese rebates through SA landside charges such as unpack, which can be charged at three or four times the normal rate.” And with the peak season fast approaching, add to that the fact that some shipping lines have reduced slots so that delays and cancelled port callings are the order of the day. “All of this is nothing new though and it comes down to good shipping line relationships that are critical to provide a reliable service.” WCS has been in existence for more than 20 years, working closely with its global partner CaroTrans that has offices at all major Chinese ports and substantial infrastructure. Offering a weekly groupage service from China to Durban, Johannesburg and Cape Town, it is one of the only companies currently rejecting rebates in favour of single-rated unpack charges, said Gunther. With unrealistically low and ever-changing ocean freight rates still placing pressure on providing a reliable service with a reputable shipping line, it is important that education takes place at all levels so that everyone is better informed and can deal with the host of challenges.