Freight charges to go up for India's exporters-importers
Container lines to levy war risk surcharge for shipments to from Arabian Gulf
India’s exporters and importers will have to pay more on freight as global container lines start levying a war risk surcharge ranging between $36 and $42 for shipping cargo containers to and from the Arabian Gulf transiting through the Strait of Hormuz in the wake of escalating tensions in the region.
French container line CMA CGM has started charging an Extra Risk Coverage Surcharge of $36 per twenty-foot equivalent unit or TEU from July 5 for shipments to/from Oman, the UAE, Qatar, Bahrain, Saudi Arabia (Dammam + Jubail), Kuwait and Iraq.
The Extra Risk Coverage Surcharge follows “the recent incidents in the Strait of Hormuz and the related significantly increasing insurance costs in the Middle East Gulf region” and is payable by the freight paying entity, the Marseille, France-based line said.
Geneva-based Mediterranean Shipping Company (MSC) said it will start collecting a War Risk Surcharge of $40 per TEU from July 8 for all cargoes moving to/from the Arabian Gulf (Bahrain, Iraq, Kuwait, Oman, Qatar, Saudi Arabia (Gulf Area: Dammam, Jubail) and UAE. “In view of the tensions in the area we are compelled to implement a War Risk Surcharge for all cargoes moving to/from the Arabian Gulf,” it said.
Maersk Line, the world’s biggest container shipping company, will impose a Gulf Emergency Risk Surcharge (GRS) of $42 per dry, special and reefer TEU to/from Saudi Arabia (Eastern Province, i.e. Dammam & Jubail), Bahrain, Qatar, UAE, Kuwait, Iraq and Oman (only Sohar and Muscat ports), effective July 10 for non-regulated corridors and August 1 for regulated corridors.
“ ...we now see a notable impact on our cost base for our shipping and logistic activities. Accordingly, to cover this cost increase, Maersk is introducing the Gulf Emergency Risk Surcharge for all cargo to/from Saudi Arabia (Eastern Province, i.e. Dammam & Jubail), Bahrain, Qatar, UAE, Kuwait, Iraq and Oman (only Sohar and Muscat ports), Maersk said in a notice to its customers.
German container carrier Hapag Lloyd announced it will levy a Vessel Risk Surcharge of $42 per TEU from July 15 for cargo to/from and via the Arabian Gulf (Bahrain, Iraq, Kuwait, Oman, Qatar, Saudi Arabia Eastern Province Ports Dammam & Jubail and the UAE). “As a result of recent maritime incidents that took place in the Strait of Hormuz, operating costs for our services in the Middle East Gulf region have increased. Hapag-Lloyd will therefore implement a Vessel Risk Surcharge (VRS) of $42 per TEU from July 15,” it said.
Global marine insurers have imposed an additional war risk premium of 0.10 per cent to 0.40 per cent of the value of a ship for every transit through the Strait of Hormuz — the only channel for ships to enter and exit the Persian Gulf carrying cargo — in the wake of recent attacks on oil tankers in the region amidst rising tensions between Iran and the US over the former’s nuclear programme.
Source: The Hindu Business Line