A group of shippers in Thailand is asking the administration to look into the validity of plans by some foreign shipping lines to raise terminal handling charges (THCs) by up to 70% from early next year.
The Thai National Shippers Council (TNSC) said the proposal of at least seven carriers to hike THCs for dry containers by 62% to 74% effective January 1, 2015 would inflate their shipping costs and make their export products uncompetitive.
Set to implement THC increases next year include SITC Shipping, Hanjin Shipping, Yang Ming Marine, Orient Overseas Container Line, Evergreen Line, China Shipping Container Lines, and Wan Hai.
The increases will see THCs expanding from THB2,600 (US$79.23) to THB4,400 per 20-square-foot unit, and from THB3,900 per 40-square-foot unit to THB6,800, up almost 69% and 75%, respectively. For refrigerated containers, the charges will increase by 62% to 64%.
“The cost of maritime shipments could increase by THB10 billion a year under the higher terminal handling charges by many logistic companies. It will totally destroy Thai exporters’ competitiveness and obstruct Thai shipment competency,” TNSC chairman Nopporn Thepsithar warned, as reported by Asia One.
He urged government agencies such as the Internal Trade Department under the Commerce Ministry to probe whether the impending THC increases are justified given dropping global fuel prices.
He also requested for a formal explanation from the shipping lines on the reasons for their increases and sought a postponement of the effective date for the hike application.
Nopporn said that while THCs could be increased by carriers to recover costs, such charges should not be imposed to recover other losses or to make a profit.
Vallop Vitanakorn, TNSC vice chairman, said the higher logistics costs would affect the competitiveness of about 85% of Thai exporters and cut their profit by about 7% to 12%.
The group also suggested establishing a maritime transport cost structure to make known the actual cost of each export process, and creating a panel to determine freight and other sea transport expenses.
Photo: Pongsak ksm
