Here’s an obvious statement for today’s world – shipping costs need to be reined in. To continue being blunt – Congress and government agencies with jurisdiction must take steps . . . yesterday!

Things are simply out of control. Sure, there’s the pandemic and all that goes with it. Then there are the many components that make up the logistics sector – shipping lines, ports, terminal operators, transportation firms to name a few. Many of those entities are reporting record volumes and record profits but that’s a tough pill for those paying so much more to move their goods. 

Everyone understands supply and demand, etc., but some of this seems to be going unchecked. I’m hearing of shippers in other countries being told their contract rates are essentially useless and that if they want to get their containers on the ship, they must pay that amount plus and perhaps plus again.

Importers are facing the same issue. The shippers that are willing to pay a premium are receiving space for “prompt” shipments but if a shipper insists to apply contracted rates the space made available to them is limited. Importers are also being hit with general rate increases, added repositioning fees, increased wharfage, fuel increases, etc. – often without notice. And all of that is just on the loading side. Similar issues exist once the container arrives at a U.S. port – delays due to port congestion, more repositioning fees, limited free time among them.

Larger shippers are seeing their rates go up but smaller shippers get that and are much more likely to be faced with what’s mentioned above. Given that, the larger shippers aren’t making much noise about the situation and don’t seem very interested in trying to find solutions. Smaller businesses, however, are being crushed with these charges and lack the support of the larger players in trying to effect change.

Of course, consumers will lose out in all of this, too. These costs can’t simply be absorbed within the supply chain. Higher prices are already being seen. Those price increases will continue and be seen across the board – food, other consumer goods, essentially anything with imported components. 

Build back better has a nice ring to it but the inflated prices on goods across the board because of these increased fees will certainly put a damper on any post-pandemic recovery.