Home » 3PL/4PL, Breaking News, Customs & Trade, Maritime, Ports/Terminals » International carriers claim losses of $5.4B since Manila truck ban

ID-100204272Roughly US$5.4 billion in losses have been incurred by international shipping lines due to port congestion since the Manila truck ban policy was implemented on February 24 until end-July.

The rough estimate, according to Association of International Shipping Lines (AISL) president Patrick Ronas, represents additional costs that 41 member-liners of the association have incurred from expenses such as increased payment for charter leases and bunker fuel for the five-month period.

Ronas, during a Lower House hearing on port congestion last week, said that since the truck ban, foreign liners have been experiencing “very low berthing time for some of our vessels.”

The shipping line executive said it sometimes takes ships four to seven days to berth, “depending on the ports where they are.”

Vessels that usually call Philippine ports have an average capacity of 1,200- to 1,500 twenty-foot-equivalent units (TEUs). And since these are mostly chartered, every ship that is idle and waiting to berth costs shipping lines $8,000 to $10,000 in charter lease per day, according to Ronas.

At the same time, he explained carriers cannot load container vans promptly because many are stuck at yards due to slow truck turnaround.

He noted some major shipping lines are already declining import boxes bound for the Philippines, while others are decreasing their weekly calls to the country.

There were earlier reports of international vessels skipping Manila ports altogether or discharging at outports such as Davao and Cagayan de Oro.

Aside from shipping lines, exporters have also been hit hard by the truck ban.


Exporter woes

Export Development Council deputy executive director Emmarita Mijares said in the same congressional hearing that one exporter lost $3 billion for opting to ship exports via airfreight to meet deadlines.

Three garment exporters also lost orders of around $6 million, while some employees have been forced to leave because of lack of work due to delayed delivery of raw materials.

Philippine Economic Zone Authority director general Lilia De Lima earlier said delayed deliveries of raw materials have caused around 20,000 layoffs.

Philippine Exporters Confederation, Inc. assistant vice president for Advocacy Ma. Flordeliza Leong, who also attended the hearing, said that unlike other stakeholders, “exporters can no longer pass on the additional costs to their customers because these are booked three or four months ahead, so they absorb the full costs and all the additional costs of the truck ban.”

Meanwhile, Air21 president Alberto Lina said truck drivers are forced to work 14 to 48 hours straight due to the slow truck turnaround. Driver fatigue could explain the recent rise in the number of accidents involving trucks, Lina said, since truck drivers should only work a maximum of eight hours a day.

In addition, he noted a decrease in the number of truck drivers, many of whom have opted to work abroad.

The National Economic and Development Authority has asked government research agency, the Philippine Institute for Development Studies, to come up with a study by September 15 on the effects of the truck ban on Philippine logistics and economy. – Roumina Pablo

 Image courtesy of kingsky at FreeDigitalPhotos.net

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