Shipper’s Council Demands the AWRA and Medfec Lower the GRI

Coming into peak season, some traders, including European and Mediterr
anean traders, announced their intention to apply the GRI (General Rat
e Increase) and other surcharges.
The Korean Shipper's Council demanded that shipping companies in AWRA
and Medfec lower their planned GRI, $350/TEU and $700/FEU, to reasonab
le levels.
Kim Gil-sup, a Korean Shipper's Council Manager, commented on this sen
sitive issue for Korean shippers, saying that Korean shippers took cha
rge of freight rates when exporting their own brand name products by m
eans of C&F (Cost & Freight), CIF (Cost Insurance & Freight), unlike s
hippers in South East Asia who usually exported their products by OEM,
which has rarely been affected by transportation rate increases.
Kim continued, "If the rate increases go through, it will result in sm
aller profits for shippers. For the rate increases to be realized, we
need the time to do it."
A shipping company authority said that shipping lines have always inve
sted in increasing sailing speed, larger cargo capacities, etc., in or
der to satisfy their customers. He added that the general rates from H
ong Kong, and South China to Europe are set $50 - $100 higher than tho
se from Korea to Europe, even though the distance from Hong Kong to Eu
rope is shorter than that of Korea to Europe.
He also pointed out that Alliance decided to implement the GRI, depend
ing on the market situation, and the principle of supply and demand.