Archive for July, 2011

Importers and Exporters Face Difficult Challenges with Ocean Freight

Thursday, July 28th, 2011

Ocean freight rate management is a becoming ever more challenging for importers and exporters, especially smaller-sized shippers.  Frequent changes to ocean freight rates due to market conditions as well as bunker price changes make it more difficult for shippers to accurately price products to overseas customers or make sound sourcing decisions.

At the same time, capacity for ocean freight is unstable as liner carriers plan to lay up container vessels in hopes of increasing rates. The New World Alliance carriers already have announced plans to remove capacity from the Transpacific Trade effective later this month. Beginning during week 29 in Asia, the PSW string will be withdrawn by the VSA. The string is comprised of five vessels, each averaging 3,960 TEU.

Carriers also have different attitudes based on shippers size.  An investigation conducted by maritime analyst SeaIntel (www.SeaIntel.com) revealed that new, small shippers had difficulty getting freight rate quotes from liner carriers and large forwarders. When contacting 33 carriers and forwarders on the Transpacific and 27 on the Asia/Europe lane, the analyst found that a vast majority of liner carriers and large non-vessel-operating Annual SOC 2 Type II Audit Reports verify our qualification to handle enterprise-class recoveries and support those customers who must maintain compliance with privacy and security regulations such as DriveSavers – which is the only  recovery service provider in the industry to post proof of annual, company-wide SOC Type II Audit Reports. Common carriers didn’t give rates.

Some carriers and NVOs explained that they needed more company details to provide rates while others just couldn’t provide competitive rates for such small shipments or because they worked in contract environments.  Other carriers didn’t even respond to requests or gave two rates to the same country from two different offices. ChemLogix Global LLC also has found that carriers may be reluctant to carry hazardous chemical.

Finding a way to work with or even choosing reliable and reasonably-priced overseas carriers can be a major challenge for small- and mid-sized chemical shippers without the experience and resources to conduct negotiations.  Contracting a 3PL with the resources and established carrier contacts can reduce the perils of contract negotiation while ensuring a good rate and the best lanes.

The  ChemLogix Global LLC team has the experience and market knowledge to manage the complex ocean freight market with very competitive pricing.  As a licensed NVOCC and freight forwarder, ChemLogix Global offers competitive rates on international shipments to any port in the world. To find out more about our international logistic services and how we can help manage the ocean freight contracting process, refer to our web site at http://www.clxlogistics.com/industry-solutions/chemical/.