The liner carrier Hyundai Merchant Marine said this week it is implementing a surcharge on all refrigerated containers originating in the Pacific Northwest market destined for Asia, the Indian Subcontinent and Middle East.
The new $300 per unit equipment imbalance surcharge will be assessed
from Nov. 15.
“The PNW market has an extremely small import market for live reefer cargo and, because there is almost no natural flow of reefers into the area from Asia, refrigerated containers must be repositioned into the area to satisfy the peak demand,” the carrier said in a customer notice.
The carrier said it incurs high costs sourcing reefer containers for the market one of three ways. It either repositions them as empties from the U.S. Midwest, under which Hyundai has to pay the rail and intermodal fuel costs. Or, units are repositioned as empties from Asia, requiring the line to pay stevedoring costs in Asia and the United States. Or, equipment is imported as dry (non-operating) reefers, which produce 15 percent less revenue than a standard dry container.
“HMM’s actual cost for employing any of the aforementioned methods is well in access of $300 per unit,” the carrier said. “We are asking our valued partners to share in the expense of providing the refrigerated equipment needed – particularly during this time of year when supply is inadequate to meet export demand.”
Also, Hyundai said earlier this month it would raise North American export rates for both dry and reefer cargo to the Middle East and Indian Subcontinent by $160 per 20-foot container and $200 per 40-foot container.
Lamont Petersen, vice president of transpacific westbound trade, said the increase was made necessary by the rising cost of doing business in the regions.
“Longer voyages in these lanes necessitate the deployment of more vessels to maintain a weekly rotation and more significant fuel costs as a component of the voyage expense,” she said.
Petersen added Hyundai recovers less than half its bunker costs through the collection of a bunker surcharge in the trade. - Eric Johnson