Ocean freight charges are on the rise.  This is specifically accurate of ocean container shipments.  In the past three months ordinary ocean freight charges (container transportation specifically) have climbed up to 55%.  Have you renegotiated your charges recently?  If not, now is the time!

There are fairly a couple fees that could be a portion of the full ocean / supply transportation expenditures on a regular import cargo.  Some could be negotiable with the provider / forwarder (given sufficient quantity and frequency) and if you have an understanding of how ocean freight charges are calculated. 

Let us take a appear at what some ocean freight expense elements could possibly be:

BAF – Bunker Adjustment Variable Surcharge

ACC – Alameda Corridor Surcharge

PNC – Panama Canal Demand

SUZ – Suez Transit Surcharge

PSS – Peak Season Surcharge

AMS – Progress Manifest Surcharge

CHS – Chassis Usage Surcharge

CAF – Currency Adjustment Variable

DDC – Destination Shipping Demand

THC – Terminal Handling Demand

ARB – Origin Arbitraries

AGS – Aden Gulf Surcharge

WRS – War Chance Surcharge

Depending on your phrases of sale (Incoterms) you could pay origin fees including:

ORC – Origin Obtaining Demand

ODF – Origin Documentation Charges

THC – Terminal Handling Expenses

DTHC – Destination Terminal Handling Expenses

If your cargo is shifting inland in the US, you could pay:

DDC – Destination Shipping Expenses

IPI – Inland Position Intermodal or MLB – MiniLandBridge

IFC – Inland Gasoline Surcharge

In addition, your container freight amount could rely on the precise commodity becoming transported. 

Of training course there are the myriad of other expenditures not straight affiliated with the ocean freight or container amount, some of which include:

Importer stability Submitting (ISF or 10+2)

Customs Brokerage

Obligation & Taxes

Stripping and / or Transloading of Containers

Interim warehousing

and, and, and …

Successfully negotiating ocean freight is not so very simple and relies upon on figuring out additional detail.  Will you have many “just one-time” shipments, or additional a repetitive company with each shipper?  How a lot products are you transport at just one time, or if repetitive, each cargo?  If repetitive, how frequently?  The solutions to these inquiries also identify if you want to use a freight forwarder or negotiate straight with the ocean carriers.

Door to door transit time is also a huge consideration.  Will you ship to a big or “gateway” port and then truck to many distribution facilities?  Or will it all go to just one DC?  If you are arranging on shifting the containers intact to an inland DC, some issues could come up based on the ocean provider, and rail fees can be fairly high.  A forwarder (or the customs broker) can frequently handle the container supply trucking to and from the port a lot far better than a provider (if the provider even would).  In any other case you have to set up the trucking.

Preference of your customs brokers would perhaps rely on your selection of routing.  The hold off at customs will rely on the accuracy and completeness of your vendors’ documents, as perfectly as the performance of the chosen broker.

Plan for achievement!  Poor arranging can consequence in a lot headache and unneeded cost.  Great achievement will stick to your superior arranging.

If you require additional detail or clarification, we will be delighted to function with you to setup a bid or RFP (Ask for For Proposal), or to audit or evaluation your present charges and procedures for feasible enhancement.

Get hold of us currently at inquiry@raymcguire.com for additional details.


Ray McGuire Consulting Group  presents path, equipment and schooling to aid you immediately and properly execute global and domestic logistics, inventory administration, agent/provider relationships, safety, social and governmental compliance or stability programs.

Increasing speed-to-industry even though cutting down expenditures!

Ocean freight charges are on the rise. Is it time to renegotiate your charges?
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