Shipping Lines Impose Extra Charges Over Rerouting Of Vessels
By Obiabin Onukwugha
Shipping firms, including Maersk and CMA CGM, say they will impose extra charges after they re-routed ships in response to attacks on vessels in the Red Sea, as worries about disruption to global trade grow.
The surcharges, designed to cover longer voyages around Africa compared with routes via the Suez Canal, will add to rising costs for sea transport since Yemen’s Houthi militant group started targeting vessels.
Maersk and CMA CGM were the first to introduce the fees, followed by Germany’s Hapag-Lloyd (HLAG.DE) last weekend.
The three are among leading shipping lines to have suspended the passage of vessels through the Red Sea that connects with the Suez Canal, the quickest sea route between Asia and Europe.
Instead, they are directing ships around the Cape of Good Hope at the southern tip of Africa, adding about 10 days to a journey that would normally take about 27 days from China to northern Europe.
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Citing “severe operational disruption”, Maersk said late on Thursday it was imposing an immediate transit disruption surcharge (TDS) to cover extra costs associated with the longer journey, plus a peak season surcharge (PSS) from Jan. 1.
Hapag-Lloyd has said it would redirect 25 ships by the end of the year to avoid the area.
China’s second largest automaker by sales said most of the shipping firms it uses for European exports have plans to go around southern Africa.
Reports say the alert speaks ill for other automakers in China as they seek to increase exports to Europe due to overcapacity and weak demand at home.
The United States had earlier announced a multinational force to patrol the Red Sea, but shipping sources say details have yet to emerge and companies continue to avoid the area.
In a message to customers, logistics firm, CH Robinson Worldwide, said it had re-routed more than 25 vessels to southern Africa over the past week.
“That number will likely continue to grow due to ongoing war risks in the Red Sea and the drought in the Panama Canal,” it said.
