FIATA International Federation of Freight Forwarders Associations has urged shipping lines to review and reinstate the current free time periods back to no less than pre-pandemic levels.
“Whilst the decision to reduce the free time periods was one-sided, market conditions have in the meantime changed, and justifications for status quo no longer remain valid,” said FIATA in its announcement.
Demurrage and detention charges is an important tool for supply chain stakeholders to ensure the efficient use of their container stock which represents a substantial investment, noted FIATA, adding that there is a need for maintaining the velocity of cargo and containers need to be turned around as fast as possible, and as a result merchants who use containers for longer periods should be discouraged from this practice.
FIATA pointed out that it is an obligation of shipping lines to provide a reasonable free period, in order to allow the merchant sufficient time for the loading and delivery of the container for exports, and the pick-up, unloading and return of the empty container for imports.
In addition, FIATA encourages shipping lines to take a look into the quality of the equipment to:
- retire equipment that is beyond its natural economical life circle and may not be “fit for purpose”
- use the period to pro-actively review equipment, maintain and repair it and ensure that it complies with appropriate standards for container quality.
FIATA calls for detention and demurrage practices to be in line with the velocity principle, with multi-stakeholder coordination to respond to market needs in a timely manner to strengthen supply chain resilience.
