Peak Season Surcharges | Is it legal?-Xiongda

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In international trade, shipping companies generally take the opportunity to add peak season surcharges to shippers every year from April and November, respectively, when freight is particularly busy.

When is the peak season surcharge charged?

Usually, the supply and demand in the international logistics market changes with time and market demand. At some specific points in time, such as Christmas, Spring Festival and other peak periods, the supply capacity of shipping companies and ocean carriers is limited due to concentrated customer demand and tighter cargo supply.

At this time, in order to increase their transportation efficiency and operating revenue, they impose additional peak season surcharges in order to take advantage of these opportunities.

 

ETD in shipping

 

Are peak season surcharges legal?

Yes, it is legal, and although it may sound ridiculous, it is legal given the expensive labor force in the United States.

How is the peak season surcharge calculated?

The amount of the peak season surcharge is usually calculated based on a number of different billing units such as per container, per ton of weight or per cubic meter of volume and can vary depending on supply and demand, market competition, and other factors.

Therefore, when selecting and evaluating air and ocean carriers, a detailed understanding and comparison of the application of peak season surcharges, their calculation methods, and the factors that affect them is required.

Other ocean freight surcharges

Bunker fuel surcharge (BAF)

A surcharge charged by shipping companies according to the change of fuel price in the market. The rate of fuel charged by shipping companies will increase if the fuel price in the market increases, and decrease if the other way around, and this charge is usually expressed as how much per ton transported or as a percentage of freight.

 

peak season surcharges

 

Currency depreciation surcharge (CAF)

The shipping party uses a certain type of currency as the settlement currency when charging freight rates, whether it is the basic freight rate or other surcharges.

Port Congestion Surcharge (PCS)

In order to compensate for the loss of congestion in some ports of discharge, the vessel’s arrival and berthing time increases, which in turn affects the shipping company’s operating costs. The surcharge charged by the shipping company to the cargo side is the Port Congestion Surcharge (PCS).

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