Emergency Revenue Charge (ERC)on ocean shipments from Asia to the US!
January 22, 2010 by admin
As part of a revenue recovery plan on the transportation trade, steamship lines have implemented an Emergency Revenue Charge (ERC). This price hike on shipments is due in large part to off-set the decline in import volumes. It is uncertain exactly how long this additional fee will be in effective. As of now, the expected time period is from Jan 15th, 2010 to April 30th, 2010. Then the already published TSA - General Rate Increase (GRI) program will be activated on May 1st, 2010.
The increase quantum will be as follows:
+USD 320 per 20’ all types
+USD 400 per 40’ all types
+USD 450 per 40’ HC all types
+USD 505 per 45’ HC all types
“Taking this step now is a milestone in the necessary recovery program expected by all operators on this major East / West trade lane. The implementation of this rate restoration on the Transpacific trade will enable us to maintain an optimal fleet deployment for the benefit of Asian and US exporters and importers ; this is the first stage towards a financial breakeven needed by the liner shipping industry on this route” explains Jean-Philippe Thénoz, Vice President North America Lines, CMA CGM Group.
These price increases are paid by the Third Party Logistic providers, and then that economic burden will likely need to be passed along to the end customer. If you see this sharp rise in your shipping costs, it is not the “middle guy” making more profit, but rather a need for him to not lose revenue and go out of business.