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5 factors that effect container shipping rates
13 Dec

5 Factors that Affect Container Shipping Rates

  1. GRI

The General Rate Increase or GRI (implemented to help carriers) is the adjustment of ocean freight prices as part of the seasonal cycle. A GRI is usually applied by sea freight company once in a year except in certain cases where it was applied several times per year.

GRI has mostly been applied to important, but in recent years, this rate is affecting most imports from the far east.

2. Shipping during high seasons increases the cost

Like all other industries, the rate of shipping goes high in high season (July to November/December). This affects not only the global supply chain and vessel capacities but also freight prices. As companies begin preparing their merchandise, shipping lines raise freight rates in response to the increase in demand.

  1. Additional cost

There are also additional freight costs that you need to pay as they aren’t included in shipping cost, yet they can increase your shipping cost exorbitantly.  Examples; demurrage, detention, and fees from custom inspections.

  1. Shortage in trucking

When trucking shortages occur, you will have to pay increased freight prices as a natural market reaction. As a sea freight company, you’ll have to pay a high price or face disruptions in your supply chain.

  1. Emergency bunker surcharge (EBS)

When carrier predicts rising fuel cost, EBS will be applied. This surcharge will increase your shipping cost.