The Hindu Business Line : Chennai box feeder operators increase congestion surcharge

CONTAINER feeder operators have increased the congestion surcharge to $50 a twenty-foot equivalent unit (TEU) from $15 a TEU for operations at the Chennai container terminal.

The hike is to recover the increased operating cost and will take effect from all vessels discharging or sailing from Chennai on or after July 15, says a trade notice issued by feeder operators.

The operators are monitoring the situation and will revise the Immediate Congestion Surcharge (ICS) at short notice depending upon the conditions. The ICS will be fully removed when container vessels' turnaround at Chennai port returns to the previous level of 24-hours for a consecutive period of two weeks, the notice said.

The operators are Advance Container Lines, Bengal Tiger Line, Orient Express Line, RCL Feeder Line, Samudera Shipping Line, Sea Consortium, Sea Services and Simatech Shipping.

Feeder operators said that the situation at Chennai port has deteriorated since the ICS was reduced (about twenty days ago). Vessels arriving at Chennai port are experiencing both berthing delays and poor productivity, which has contributed to longer port stays.

Recent turnaround times have increased to 5-6 days, the notice said.

This was compared to berthing within 24 hours on arrival before January. "This only shows that the labour problem in the terminal has not been resolved. The current productivity in the terminal is 15-16 moves per hour per gantry compared to about 25 moves before January," said an industry source.

The trade members are not only agitated that they are asked to bear the additional cost, but also feel that the private operator, Chennai Container Terminal Ltd (CCTL) of the global major P&O Ports, is unable to resolve its internal problems.

Normalcy is yet to be restored in the terminal after the strike by CCTL employees between May 23 and June 3, which paralysed operations in the terminal, an industry source said.

They charged that the trade was being asked to pay an additional cost for CCTL's problems.

The trade is losing about Rs 10 crore a month on account of additional charges, including storage and transportation.

Importers are also denied Customs inspection and direct delivery of boxes from the terminal, which is causing hardship to the trade as also hiking the transactional cost and time, a trade source said.

The problem in the terminal compounded in the last few days. As a temporary measure to decongest the terminal, the trade allowed CCTL to send 3,900 boxes out of the terminal to off-dock container freight stations from June 21 to June 30. This followed an assurance by CCTL in a meeting in June that normalcy will be restored in the terminal once these boxes were sent out.

However, this plan of CCTL did not work as over 15,000 boxes were waiting at hub ports of Colombo, Port Klang and Singapore to be shipped to Chennai. The problem continues at the terminal with huge inflow of import boxes, leading to yard congestion, a source said.

Capt M.A. Pillai, General Manager, CCTL, quit the organisation last week.

Following this, there have been organisational changes in CCTL. Mr Ennarasu Karunesan joined CCTL today as Terminal Manager. His last assignment was head of container department with Westport, Port Klang, Malaysia, a container terminal handling 3 million TEUs a year.

Capt. Vikram Sharma, Director-Operations, P&O Ports, Mumbai, will hold temporary charge of CCTL, said a source.

It may be recalled that Mr Ganesh Raj quit as Chief Executive Officer of CCTL in January.

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