PPA seeks hike in foreign container storage charges beyond free period

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PPA seeks hike in foreign container storage charges
Image by Jarosław Bialik from Pixabay
  • The Philippine Ports Authority is seeking a 32% increase in storage charges for foreign containerized cargoes beyond the free storage period and a 150% surcharge in storage fee of reefers
  • The hike is meant to prevent congestion via optimization of yard space usage and expedited withdrawal of containers
  • From 2014 to 2022, 52% of the 13.98 million foreign containers in PPA ports went beyond the free storage period, denying accommodation to other inbound containers
  • Stakeholders have until October 24 to submit their position papers on the proposed hike

The Philippine Ports Authority (PPA) is seeking to raise storage charges for foreign containerized cargoes beyond the free storage period by 32% and introduce a 150% surcharge on reefer container storage to alleviate congestion at terminals by encouraging timely container withdrawals.

During a public consultation on the proposal on October 18, the PPA Commercial Services Department said storage rates for foreign containerized cargoes, which include imports, exports, and transshipments, have remained unchanged since 2014.

A previous increase in 2014 also did not deter the buildup in foreign containers exceeding the free storage period (FSP) at PPA ports.

READ: PH container storage fees doubled with graduated increments

The rate increase, PPA said, is meant to optimize yard space usage and expedite the withdrawal of import containers, thus preventing congestion.

The 150% surcharge eyed on reefer storage rate, the agency added, will compel importers to pull out their customs-cleared containers, ensuring essential storage space inside the ports and deterring the practice of using ports for storage.

PPA said the congestion in reefer containers—with some staying for six to seven months in terminals—have led to the conversion of regular warehouses into makeshift reefer container storage. More affordable storage charges at PPA ports compared to private warehouses’ have resulted in the buildup at PPA facilities, impeding the accommodation of other inbound containers.

PPA said the increase in storage charges is not meant as a revenue source for the agency, and that cargo owners can easily avoid the fees by promptly withdrawing containers within the FSP.

Between 2014 and 2022, PPA ports managed a total of 13.98 million foreign containers, with 52% going beyond the FSP. Of those, 50.27% were imports, 49.71% were exports, and the remainder were transshipments.

Among the containers staying past the FSP, 92.07% were dry containers, and 580,091 were reefers. Notably, 66% of foreign containers exceeding the FSP were in Manila International Container Terminal, with Manila South Harbor hosting 30%, and the remaining 4% distributed among other PPA international ports.

The following are the proposed daily charges for 20-footer import containers going beyond the FSP of five days:

  • P635.32 from the previous rate of P481.30 for days 6 to 10
  • P698.85 from days 11 to 15
  • P762.38 from days 16 to 20
  • P825.91 from days 21 to 25
  • P889.44 from days 26 to 30
  • Beyond 30 days, P952.97 from the previous P721.95

For exports, the daily rates for a 20-footer following a four-day FSP will be:

  • P79.40 from the previous rate of P60.15 for days 5 and 6
  • P158.80 from P120.30, for days 6 to 11
  • P174.68 from days 12 to 16
  • P190.56 from days 17 to 21
  • P206.43 from days 22 to 26
  • P222.31 from days 27 to 30
  • P238.19, previously P180.45, beyond the 31st day

For transshipment, after the initial 15-day FSP, the proposed daily rates for a 20-footer are:

  • $14.44, up from the previous rate of $10.94, for days 16 to 20
  • $15.88 from days 21 to 25
  • $17.33 from days 26 to 30
  • $18.77 from days 31 to 35
  • $20.22 from days 36 to 40.
  • $21.66, previously $16.41, beyond 42 days

The proposal also includes new rates for 35-footers, 40-footers, and 45-foot containers.

The proposal’s calculation is grounded on the 2013-2022 Consumer Price Index, reflecting the average retail prices for commonly purchased goods and services in a specific region.

The proposed revised storage rates will be implemented across all PPA government ports managing foreign containerized cargoes. PPA has so far no plans to modify storage charges for non-containerized cargoes.

Stakeholders have until October 24 to submit their position papers regarding this proposal. – Roumina Pablo