GCA requests emergency reprieve on container demurrage & detention charges
The Covid-19 outbreak has already negatively affected many aspects of the shipping industry. As the coronavirus spreads, the general expectation is that things will worsen. The Green Coffee Association (GCA) of the US has reported that the Harbor Trucking Association and other transportation organisations of the United States have noted difficulties in picking up and returning equipment at some terminals. Globally, warehouses have implemented restricted hours of operation and reduced their capacity.
Exacerbating the issue, certain production facilities are reducing their output, limiting the amount of space in warehouses to unload new cargo. There’s also a strong possibility that truck drivers could become ill, further reducing the ability to pull containers from port or return them promptly. Additionally, major ports such as the Port of Houston have temporarily closed because of Covid-19 outbreaks, while the Port of Miami has suspended operations due to low volumes and sporadic closures at terminals around the US. A majority of state governments have now ordered non-essential workers to stay at home.
Although the ocean carriers and terminals could technically make the containers available for pickup, limitations in the pandemic supply chain will have negative ramifications on operations. The expectation is that it will take longer to gate out containers and return them empty. Therefore, the Green Coffee Association (GCA) of the US has requested carriers, ports and terminal operators to work together to grant a temporary full waiver for demurrage and per diem charges.
In a letter to carrier (such as Maersk, Hamburg Sud, Sealand, etc) and Port Authority (such as the Port of New Jersey and New York, Port of New Orleans, Port of Los Angeles, etc) representatives nationwide, Donald S Pisano, chairman of the GCA’s logistics committee said, “This is a difficult time for all of us but putting financial strain on the industries that utilise the ports will be disastrous for the supply chain infrastructure. We hope you share this concern and will work with us to eliminate potential punitive demurrage and detention fees during this critical time.”
The GCA is currently awaiting responses from the carriers and Port Authorities.