Cost Pressures on Ocean Freight for 2H 2018

In an environment of import/export uncertainty and the potential for increased tariffs later this year, peak season for shippers came early in 2018.

US import volumes took a larger than normal upturn well ahead of the holiday retail season for a number of reasons including:

– Capacity cuts and service changes
– A slow Q1 and Q2
– Looming Tariff deadlines.

These and other factors led carriers to push for spot rate increases of $600 to $1000 per FEU in August and September. Also adding to upward price pressure, the International Maritime Organization has mandated under new Emission Control Area regulations that by 2020, all merchant vessels must reduce their sulphur emissions to 0.5% from 3.5%. Whether they upgrade their vessels or their fuel, carriers will need to undertake significant changes to comply with the new regulations, and those changes will come at a cost to shippers.

Getting More For your Shipping Dollar – Beneficial Cargo Owner (BCO) Rates

One thing JM Rodgers will do to help you lower your shipping costs is to leverage your direct BCO contracts with the carrier. Using these contracts so clients are in full control of the pricing, JMR will provide all the normal freight forwarding services we offer such as bookings, outlays, and tracking. .

In addition to potentially yielding significant savings in Ocean Freight, there are a number of other benefits to this arrangement:

  • Potential for extended payment terms and preferential treatment
  • Assistance with contract negotiation and negotiation of amendments
  • Reporting on MQC usage monthly.
  • Flexibility in crunch times using our separate NVO contracts- your cargo WILL get moved

And if you aren’t lucky enough to qualify for your very own BCO contracts don’t worry, you can still achieve better rates by utilizing JMR, as we are an FMC-registered NVOCC utilizing our own ocean contracts along with access to Tier 1 contracts.

Freight Management For all Levels of Logistics

After doing this for over 65 years there is one thing we’ve learned for sure: most COO’s would rather deal with making products than making paper trails. As both a logistics and a customs company, we understand we are dealing with the lifeblood of your company and you won’t find another Customs House Broker with a more complete set of knowledge and skills to take your business to the next level and save you money.

Give us a call today and let’s see if we can help.