Grand Alliance cuts UK direct calls as congestion mounts

HIGHER costs for British retailers are in the offing as Grand Alliance shipping lines cut back on direct calls at UK ports to avoid congestion, reports the Financial Times.

The move, by Hapag-Lloyd, NYK Line, OOCL and MISC, is one of several cutbacks on service to congested ports. While targeted ports span Europe, they have hit hard Southampton, and the UK's biggest container port, Felixstowe.

Goods are being sent more to continental ports such as Rotterdam, and then transhipped by feeder vessels. UK businesses receive the goods more slowly and pay more for the extra handling and the smaller ships' higher costs.

Extra handling fees can amount to EUR150,000 (US$220,000) for a 500-container shipment if the continental port charged EUR150 a container for the two extra handling moves needed to transship the consignment.

Looking on the bright side, Southampton Container Terminals told the FT that some traffic was also shifting back to the UK from congested mainland ports and such developments would offset the problem.

Adolf Adrion, a member of the board at Hapag-Lloyd, the world's fifth largest container line, said that for three consecutive months every second Grand Alliance service calling at Southampton had been kept waiting for three days before it could be handled.

"Every second vessel we then decided to pass by and discharge the UK cargo in Antwerp," he said. "I think we were patient quite a long time but if it continues and you don't see light on the horizon, you discuss it and change. We were not the only line suffering. It was the whole industry."