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Summer Means Sunshine… and Shipping Surcharges

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Sun Setting on the Gulf of Mexico (Photo credit: DonMiller_ToGo)

Although many consider Memorial Day to be the unofficial start of summer, pedants will argue that it officially remains spring until June 21st. Either way, most of us go by whether or not the sun is shining!

For the shipping industry, another date is the key to seasonality, and this year it's Sunday June 15th.

Unfortunately, it doesn't translate to sunshine and time off, only high demand for container space and higher prices to pay.

A Look at the Peak Season Surcharge (PSS)

Wan Hai 206 At Hong Kong (Photo credit: wirralwater)

Per a confirmation from the team at Delmar Cargo:

"Transpacific ocean freight carriers have announced their intentions to implement the following Peak Season Surcharge (PSS) from Asia & the Indian Sub-Continent to all Canada and USA destinations at the below-indicated levels. 

Effective June 15, 2014: 

usd 8.00 per cbm or 500kg
usd 320 per 20' container
usd 400 per 40' container
usd 450 per 40'HC container
usd 510 per 45' container"

The PSS may refer to any cargo surcharge applied during the typical summer/fall peak season, but for American consignees it is most frequently incurred on shipments from Asia, where volume is highest. It's a common enough phenomenon, but one that nonetheless requires pricing adjustments and a little extra effort across the supply chain.

Peak season is an annual challenge for everyone involved in the logistics of moving goods around the world.

If it all seems a little early, consider that the lead time for a shipment produced in China is around 24 days. Add in the requirement to allow some slack for production issues, packing and loading cargo into containers, and the transportation logistics involved in getting cargo from a U.S. port to various distribution centers around the country... suddenly time is at a premium!

With the potential for lower priority cargo to be rolled from its scheduled shipment date, plus the need to have products in stores by September in some cases, this rush during the summer months certainly makes sense. And so do the shipping surcharges, although a groan inevitably goes around every time they're announced.

This informative article from Kurt Salmon explains the potential and pitfalls of the 2014 peak shipping season well.


Check for Exceptions

Finally, it's also worth checking with your preferred shipping line exactly when they implement surcharges such as these.

Although the standard implementation date is usually adopted, some lines announce individual exceptions, as did Mediterranean Shipping Co, who this year won't apply the transpacific PSS to U.S.-bound shipments until July 1st.