Peak season shipping tips come down to three habits: book early, pack well and plan for extra fees. Space on ships is tight this autumn, and small exporters are in the same queue as big ones. A shipper who waits until the week of the deadline will pay more and may not get a slot at all. This guide covers what to do now, with the year-end rush close.
Know what you are up against
Ocean freight costs are far above normal. Drewry, a shipping consultancy, publishes a weekly World Container Index. On November 4 it stood at $9,195 per 40ft container. That is 252 percent higher than the same week a year earlier.
Prices on single routes are higher still. Drewry put Shanghai to Rotterdam at $13,798 per 40ft box and Shanghai to Los Angeles at $9,857. Both had slipped from the week before, but they remain very high. Freightos, which tracks quotes, reported a similar picture for Asia to the US West Coast in early September: $18,425 per 40ft, about 452 percent above a year earlier.
The lesson is simple. Do not treat a quote as a fixed price. Ask how long it is valid, and ask what it leaves out.
Sources: Hellenic Shipping News, "Drewry: World Container Index Down 4.9% This Week," November 6, 2021 (https://www.hellenicshippingnews.com/drewry-world-container-index-down-4-9-this-week/); gCaptain, September 6, 2021 (https://gcaptain.com/msc-increase-peak-season-surchargebetween-europe-us/).
Book earlier than feels necessary
Carriers are filling ships well ahead of sailing. If your cargo is ready in three weeks, talk to your forwarder this week. Give a clear picture: what you ship, how many boxes, the port of loading and the date the goods will be ready.
Ask your forwarder for the cut-off dates. There are usually two. One is when the empty container or the cargo must reach the terminal. The other is when the shipping documents must be filed. Missing either one can roll your cargo to the next ship, which may be a week or more away.
Build slack into your plan. If the buyer needs goods by a fixed date, count back from that date and add extra days for port delays. Busy ports can hold ships and boxes for days, so a tight schedule can slip.
If you ship small loads, ask about shared containers, known as LCL. They can cost less than a full box. They can also take longer, because the cargo is packed and unpacked at depots.
Expect surcharges, and ask about each one
Carriers have added peak season surcharges this year. For example, MSC announced that its charge between Europe and the US would rise by $1,000 per 40ft box on October 1, to $2,700. Surcharge names and amounts differ by carrier and route, and they change often.
Before you accept a quote, ask these questions:
- Is the peak season surcharge included, or added later?
- Are there fees for handling at the port or for fuel?
- What happens to the price if the ship is delayed or the cargo rolls?
- Who pays for storage if the container sits at the port?
Write the answers down. Put them in the shipping order so there is no argument later. When you set your own selling price, build in a cushion for freight, or use a clause that lets the price move with freight costs.
Sources: gCaptain, "MSC to increase peak season surcharge between Europe and US," September 6, 2021 (https://gcaptain.com/msc-increase-peak-season-surchargebetween-europe-us/).
Pack for a longer, rougher trip
Goods may sit longer than planned at ports and in yards. Pack for that. Use strong outer cartons and fill empty space so boxes do not shift. Seal cartons well, and put labels on at least two sides.
Moisture is a real risk on long sea trips. Wrap sensitive goods in plastic and add desiccant bags. Mark cartons that must stay upright. Put your marks, the buyer's name and the carton number on every box, so a damaged carton can be matched to the paperwork.
Take photos of your packed goods before they leave. If a claim comes later, photos help. Check your cargo insurance too. Ask what it covers when a ship is delayed, and whether it covers goods stored at a port.
Get the paperwork right the first time
Errors in documents cause more delays than most exporters expect. Check the commercial invoice, the packing list and the bill of lading against each other. Names, quantities, weights and product descriptions should match exactly.
In Singapore, most exports need a customs export permit, applied for through TradeNet. A business needs a company registration number and an active customs account. It can then appoint a declaring agent, or register as one itself. Other countries have their own systems, so ask your forwarder what your port needs. File early, because a rejected permit can miss the cut-off.
Some goods need approval from another government agency before export. Check this at the start, not the day before sailing.
Sources: Singapore Customs, "Obtain Customs Export Permit" (https://www.customs.gov.sg/businesses/exporting-goods/export-procedures/apply-customs-export-permit).
A short plan for the next six weeks
- This week: tell your forwarder your volumes and ready dates.
- Within two weeks: confirm bookings and cut-off dates in writing.
- Before the cargo ships: finish packing, photos and documents.
- After it ships: track the ship and warn your buyer early if it slips.
Talk to your buyers now, too. Tell them about the longer lead times and ask which orders are the most urgent. Most buyers prefer an honest date to a surprise.
Sources
- Hellenic Shipping News, Drewry World Container Index, November 6, 2021: https://www.hellenicshippingnews.com/drewry-world-container-index-down-4-9-this-week/
- gCaptain, MSC peak season surcharge, September 6, 2021: https://gcaptain.com/msc-increase-peak-season-surchargebetween-europe-us/
- Singapore Customs, Obtain Customs Export Permit: https://www.customs.gov.sg/businesses/exporting-goods/export-procedures/apply-customs-export-permit