Shipping companies implement Emergency Bunker Surcharge
28 November 2018
Update: EBS to $100 per TEU
We received a notification from several shipping companies that the Emergency Bunker Surcharge (EBS) will be increased again. From on board date 1 December 2018, this surcharge will be an average of $100 per 20-foot container (TEU). This is $35 per TEU more than the most recent increase that applied on 15 October 2018.
Ritra Cargo is unfortunately obliged to pass on this surcharge to you. From on board date 1 December 2018, we will charge a fixed rate of $100 per TEU.
The EBS was introduced on 1 June 2018 because of the fast-increasing oil prices. Since then, this was increased twice. After months of increase, the oil prices are now falling again. It is expected that the EBS will be adjusted accordingly in the near future.
Update 11 October 2018: EBS increased to $55 per TEU
As of 1 June 2018, the Emergency Bunker Surcharge (EBS) applies to all sea freight transports. Shipping companies were forced to introduce the surcharge to cover a sharp increase in fuel costs. However, it has recently been determined that the current surcharge is insufficient. Shipping companies have therefore announced that the EBS will be increased by an average of $10 per 20-foot container (TEU) by October 2018.
The EBS will be detailed in a separate line on your sea freight invoice. Ritra Cargo applies a fixed rate of $65 per TEU (previously $55). This applies to all sea freight transports with on board dates from 15 October 2018 onwards. Unfortunately, it is not known how long the EBS will be in effect.
Announcement 29 May 2018
Shipping companies introduce Emergency Bunker Surcharge
Fuel prices are skyrocketing. Since June 2017, these have risen with over 70%. As a result, the current bunker surcharge does not cover fuel expenses by far. That is why shipping companies have announced the implementation of an Emergency Bunker Surcharge (EBS) starting June 1st. This will apply to all sea cargo transports with a boarding date starting June 1st.
The EBS should limit the extent of massive losses at shipping companies
Despite growing volumes and revenue, most shipping companies are operating at significant losses. The high costs of fuel are a major reason for this. Since January of this year, the price for a vat of raw oil has risen with 70%. Normally, fluctuations in fuel prices are factored into the bunker surcharge. However, the price increase has become so high that the regular surcharge cannot keep up with it.
That is why shipping companies are using the EBS as an emergency measure. CMA, CMG, APL, MSC, and Maersk Line have already announced implementing the EBS for all sea cargo transports starting June 1st. This extra fee on fuel prices should prevent the shipping companies from going deeper into the red. The expectation is for other shipping companies to soon follow. It is unknown at this time how long the EBS will be maintained.
Emergency Bunker Surcharge per TEU
The height of the EBS is roughly equivalent for all shipping companies. On average, a surcharge of $55 per twenty-foot equivalent units (TEU) will be charged. This surcharge will be reflected in your sea cargo invoice. Ritra Cargo will keep a standard rate of $55 per TEU for this. This surcharge will apply to all sea cargo transports with a boarding date starting June 1st.
Questions and further information
Do you have more questions about the EBS after reading this article? Feel free to contact us.
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