Shipping Giants Impose Urgent Surcharges Amid Red Sea Tensions

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  • Two of the world’s largest shipping firms will impose extra charges after re-routing ships following attacks on vessels in the Red Sea.
  • Maersk and CMA CGM are the leading shipping lines to have directed ships around the longer Cape of Good Hope at the southern tip of Africa.
  • Maersk said that a standard 20-foot container traveling from China to Northern Europe faces an extra charge of $700, consisting of a $200 TDS and $500 PSS.

Maersk and CMA CGM, two of the world’s largest shipping firms, will impose extra charges after deciding to re-route ships following attacks on vessels in the Red Sea, reports CNBC.

Container surcharges

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 targetting vessels.

Maersk and CMA CGM are among the leading shipping lines to have suspended the passage of vessels through the Red Sea that connects with the Suez Canal, directing ships instead around the Cape of Good Hope at the southern tip of Africa.

Citing “severe operational disruption”, Maersk said late on Thursday that additional payments include an immediate transit disruption surcharge (TDS) to cover extra costs associated with the longer journey as well as a peak season surcharge (PSS) from Jan. 1.

In total, a standard 20-foot container traveling from China to Northern Europe faces an extra charge of $700, consisting of a $200 TDS and $500 PSS, Maersk said.

Containers bound for the east coast of North America will be charged $500 each, consisting of the $200 TDS payment and a $300 PSS, the company added.

Maersk also said routes in other parts of its network would be affected by the Suez disruption, triggering emergency contingency surcharges on various journeys.

CMA CGM also announced surcharges late on Thursday, including an extra $325 per 20-foot container on the North Europe to Asia route and $500 per 20-foot container for Asia to the Mediterranean.

It said the charges were part of its contingency plan to reroute vessels around the Cape of Good Hope.

France-based CMA CGM listed 22 of its vessels as having been re-routed.

The United States has announced a multinational force to patrol the Red Sea, but shipping sources say details have yet to emerge and companies continue to avoid the zone.

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Source: CNBC

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