3PL Associations Hit Back at New Maersk Surcharge

On Monday, September 17, Maersk shipping line announced that it would be introducing a new Bunker Adjustment Factor (BAF) in advance of new global regulations that will force shipping lines to reduce air pollution. The Maersk surcharge will take effect on January , 2019, while the new global regulations do not take effect until January 1, 2020. In response to the charge, leaders of 3PL associations have spoken up about the difficulties this new charge will cause for their members and shippers.

The new BAF replaces the existing Standard Bunker Factor (SBF) for Maersk. The company announcement of a new BAF states that the new charge will increase predictability for customers. However, this predictability will come at a cost. Maersk estimates that prices for a 40-foot container moving from the United States to North Europe could increase from $120 to $210.  Shipments moving from the Far East to the U.S. West Coast could increase from $390 to $683.

In addition to TIA, 3PL associations around the world are concerned by these new charges. Robert Keen, the Director General of the British International Forwarders Association (BIFA), notes “By any measure, these are major increases, and they will be received negatively by BIFA members’ customers….rises of this magnitude are unjustified and could be construed as blatant profiteering by shipping lines determined to exploit the situation.”

In 2016, the International Maritime Organization (IMO) finalized a rule that will cap global sulphur emissions from shipping beginning January 1, 2020. This rule will force ocean carriers to use fuel with lower sulphur content or to mitigate their emissions through installation of exhaust “scrubbers.” Overall emissions from shipping are expected to be reduced by over 80 percent under this rule. Unfortunately, the costs of implementation will be passed on to the customers of the shipping lines, who will be impacted by more volatile fuel prices and limited supplies for low-sulphur fuel once the rule takes effect.

TIA will continue monitoring this issue, and may take action through its International Logistics Conference. To view the Maersk announcement, click here.  For more information about TIA’s position on this surcharge, or to get active in the International Logistics Conference, please contact Will Sehestedt at sehestedt@tianet.org.