Devastating Increase in the Cargo Tariff in Pakistan

A 77% increase from India’s and 51% from Sri Lankan’s cargo Freight, point to consider seriously

There is a massive increase in the cargo tariff in Pakistan due to which the shipping companies are threatening to scrap their services in the South Asian country. Pakistan’s largest port is already handling with global overcapacity and low freight rates.

What Did Hyundai Merchant Marine Do?

The South Korean company, Hyundai Merchant Marine.co is seriously considering the dropping deployment of larger vessels in Pakistan. They expressed this situation in a letter to the Karachi Port Trust and a copy of this letter was also seen by Bloomberg which is, further confirmed by the company.

There are also some biggest names of shipping companies in the world like Maersk Line, the world’s biggest container carrier and part of A.P. Moeller-Maersk A/S and American President lines Ltd said that the massive increase in tariff has created tough and distress situation amongst the members.

Tariff Charges at Karachi Port Trust

If we go to a roughly estimate then we see that there is almost a double jump increase in the tariff for many types of vessels. This is revealed by Pakistan’s ship Agents Association when the operator, on Aug 29, removed a cap on tariff for the vessels which weighs over 45,000 gross registered tons.

What Did Hyundai’s Chief Operating Officer Say?

After this significant and devastating increase in the cargo tariff in Pakistan, the Hyundai’s Chief operating officer, Kyounguk Lee said, “The revision causes a significant cost increase to all the carriers.”

He is also of the views that due to this increase, port cost increase as well as extremely low ocean freight focuses them to seriously count it.

Hyundai Merchant Ship Charged Mighty Tariff

On its two day stay at Karachi port, A Hyundai Merchant ship of 94,511 GRT will have to pay $82,905, very high freight rate. If we compare the freight with the other South Asian countries, the figures looks like 77% higher than India’s Nhava Sheva port and 51% higher than Sri Lankan’s Colombo port. These figures are reported by Kyounguk Lee, Hyundai’s Chief operating officer.

Still nothing sure about where these mighty freights increase will take Pakistan’s cargo industry. But it is sure that the shipping companies are facing serious trouble.