Home » Maritime » Shippers reeling from congestion at SH, MICT

CARRIERS and shippers are reeling from congestion at the South Harbor and the Manila International Container Terminal (MICT).To lick the problem, the free delivery system is now temporarily in place at the two ports.

Stakeholders are claiming the congestion – caused by a combination of factors from the slow electronic-to-mobile system of the Bureau of Customs (BOC) following an upgrade from the system’s Phase 3 to Phase 4 and increased trade volumes to generally lack of container space — has resulted in delays that have jacked up overheads.

Some shipping line operators are reportedly paying an average of $15,000 in additional handling cost per vessel per day because their ships are taking longer to berth. This is happening because ships now have to wait longer than usual for space to become available before unloading their cargoes, a situation in turn caused by too many containers not being cleared for release at the usual pace.

The waiting time for vessels is now reportedly from three to five days. At the maximum five days waiting, the additional cost to a shipping operator amounts to $75,000 or about P3.27 million based on last Friday's exchange rate of P43.66 to $1.

The congestion, some PortCalls sources said, began around August when MICT encountered technical glitches with its automated gate system. The situation, they claimed, has yet to completely return to normal.

Virgilio Angeles, COSCO Philippines general manager, explained the congestion has both a "happy and sad face", with the "happy face" suggesting strong trade volumes and the "sad face", additional costs.

"This is really a combination of factors such as higher volume of inbound cargoes, strict implementation of customs processes and procedures and lack of container spaces at the ports," Angeles told PortCalls at the sidelines of last week's induction ceremonies for the new board of the Philippine Ship Agents Association. Angeles is the association's vice president for internal affairs.

"Inbound cargoes have increased 40% this year and the lack of cargo spaces at the port have resulted in longer waiting time for vessels," he said.

"Hopefully, government along with the port operators will find ways how to reduce the congestion," Angeles added.

SITC Container Lines commercial manager Arnie De Guzman, in a separate discussion, noted that port congestion is "really a problem for shipping lines and shippers right now. The waiting time for a vessel before it is attended to is too long and we are not happy about it but we are willing to adjust considering that the congestion is not our fault and also due to the swelling import volume.

"However, we are urging the operators to also make some adjustments in order to reduce the waiting time to a more manageable period and to reduce the extra cost brought about by the delays," he told PortCalls.

Free delivery system

The South Harbor and MICT operators along with the Philippine Ports Authority, BOC, shipping lines and consignees in a recent meeting agreed to work together to lick the congestion problem.

In that meeting, it was agreed that the free-delivery system at the two ports will be temporarily implemented to ease container congestion. This is the first time in a while time that the scheme is being implemented.

Free delivery allows consignees whose cargoes arrive at the two ports on Friday to pull them out the next day without incurring any penalties as long as all import papers are in order. Ordinarily, cargoes that arrive on a Friday get stuck at the ports throughout the weekend because there are no Bureau of Customs personnel to conduct customs processing.

In the same meeting, the BOC said its personnel will render overtime work on Saturdays to ensure import cargoes may be released on that day.

The BOC is also seeking the help of the Department of Finance and the Bankers Association of the Philippines to look for ways to allow auto payment of duties and taxes during weekends.

Shipping lines, for their part, committed to pull out empty containers at the soonest time possible subject to vessel space availability.

While waiting for congestion to ease up, one major container line is reportedly eyeing to call Batangas port and truck cargoes to Manila.

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