Jasim Uddin Haroon:
Main Line Operators (MLOs) Tuesday announced year-long business plan hiking freight cost for westbound exports by more than 200 per cent.


Presently, they are charging 800 dollars for the same westbound exports, i.e., for European destinations. They have planned in their business plan to charge additional 1600-plus dollars as rate restoration (RR) until December next.

They also planned to raise more than 100 per cent for eastbound exports.

Currently, they are charging nearly 300 US dollars in the routes for Japan, Korea, China etc. They have planned to implement nearly 300 dollars RR until December 2012.

These raises in freight cost will adversely affect the country's exports, leading garment manufacturers said.

Informal South Asia Agreement (ISAA), a cartel of leading MLOs, has announced this new rate restoration business plan.

The cartel said MLOs have already implemented their first phase of RR at a rate of 150 dollars for a 20-foot container for westbound exports from January 01.

They will implement second phase RR worth 100 dollars for each 20-foot container for westbound exports from March 01.

The MLO group will also impose 250 dollars on the same route from April 01. It said the member lines want to maintain a high standard of service in South Asian sub-continents.

ISAA said member lines reserve the right to implement a peak-season surcharge during the stress periods of the year to adequately cater to the strong demand from customers.

ISAA said it already implemented 100-dollar raise in freights from January 1 for eastbound (China, Japan, Korea etc.) exports they will implement 50-dollar raise from April 1 and another 50 dollars from July 1.

The MLO group said these rate increases will be applied in addition to ongoing ocean freight rates. Shafiul Islam Mohiuddin, president of BGMEA (Bangladesh Garment Manufacturers' and Exporters Association), told the FE: "This plan by the MLOs is a bad news for his sector."

"If the plans are implemented, it will affect our sector adversely," he added.

APL, CMA CGM, Cosco Container Lines, Evergreen Line, Hapag-Lloyd, Orient Overseas Container Line, PIL, Samudera Shipping, Hanjin Shipping are the leading members of the ISAA.