Shippers urged to brace for higher ocean freight rates

The seafreight rates holiday is
officially over.
Shippers and forwarders
have confirmed what lines and
analysts have been reporting
for some time – that rates are
finally firming,
and SA
routes are no
exception.
Value
Logistics
divisional
director
Stephen Segal,
just back in
South Africa
from an
intermodal
conference in Germany when
FTW spoke to him, said that it
was a hot topic at the event.
“The feeling is that they
will increase – and they have
to increase from the clearing
agent’s point of view because
unless they do you’re making
no profit.”
“There are GRIs (general
rates increases) coming
through from the Far East on
a monthly basis – and even a
Europe southbound GRI was
announced in January,” CFR
Freight managing director
Martin Keck told FTW.
“But the question remains
whether shipping lines will
be applying them across the
board,” said Segal.
A view shared by ECU
Worldwide sales director
De-Leon van Rooyen.
“Shipping lines have indicated
more GRIs, but as we have
become accustomed in the
industry there is a waiting
game involved before there’s
confirmation of exactly how
much the GRI will be.
“We have
seen an
increase in
rates ex Asia
where demand
has outstripped
supply, but
rates seem to be
negotiable on
the Europe and
Brazil routes.”
GRIs out of
the Far East
have been between US$200-
300 per TEU, according to
CFR Freight seafreight sales
manager Lee Viljoen.
“Based on capacity the
carriers decide on the
movement of this
surcharge,” she told
FTW
“Every year the
lines announce an
increase, but this
time it would
seem they are
determined
to implement
the whole
increase,”
Geodis
managing director Jan
Ludolph added.
And it appears the lines are
not interested in long-term
contracts.
“For NVOCCs and general
rates there are no long-term
contracts,” said Keck. “We are
“living” on a month to month
basis.”
“They’re offering freight
rates on enquiry,” added Segal.
“You don’t even get a rate valid
for a week or two."
“For years the whole
supply chain has been saying
that freight rates are not
sustainable,” said Keck. “Now
that there are adjustments
happening there seems to be no
acceptance.
“I strongly believe that
importers and exporters need
to change their views given
the marginal percentage that
freight costs represent as a
part of the entire product
costing.”
INSERT & CAPTION
You don’t even get a
rate valid for a week
or two.
– Stephen Segal