Each day TFO Canada publishes a sample of trade news on the Canadian import market along with any new, updated or changed regulations and legislations regarding international trade; countries in which TFO Canada offers services and on the export sectors which it promotes.
Importers Balk at $20 million in Port Metro Vancouver Storage FeesMonday, May 26, 2014 > 10:18:13
(Vancouver Sun – Bruce Constantineau)
Western Canadian importers are fuming over millions of dollars of unexpected container storage fees charged by Port Metro Vancouver terminal operators during the 28-day port labour dispute earlier this year.
The import companies estimate the terminals collectively charged more than $20 million in storage fees for containers that were stuck on the docks during the truckers strike.
“The fees are there to ensure importers don’t use the dock as a storage place,” Canadian International Freight Forwarders Association executive director Ruth Snowden said in an interview. “But there was a labour dispute going on and very few containers could be moved. This just adds insult to injury.”
Snowden said Port Metro Vancouver terminals typically levy a storage fee for containers that have been on the dock for more than three days, using a sliding scale that tops out at $460 a day for a 40-foot container still on the dock after 10 days. She feels Port Metro Vancouver terminal operators should refund at least a portion of the storage fees, noting a CIFFA survey found companies are paying an average of about $3,000 in extra costs for each container.
Furniture retailer The Brick had 129 containers stuck at the docks and was billed nearly $500,000 in storage fees. “These costs should not be passed on and borne entirely by shippers like The Brick and ultimately consumers,” The Brick president Jim Caldwell said in a statement.
Consumer prices, jobs and the western Canadian economy will be negatively affected by the unexpected storage fees, said Garry Mooney, vice-president of freight forwarding company Gillespie-Munro Inc.
He said while terminal operators may profit in the short term, Port Metro Vancouver might lose business as importers and exporters seek better conditions at other ports such as Prince Rupert, Tacoma and Seattle. “That’s not something we want to see,” Mooney said. “We want a vibrant, efficient and sustainable port in Vancouver. But penalizing Canadian importers for a situation that was out of their control is hardly the way to build customer loyalty.”
Snowden said TSI, which operates Vanterm and Deltaport terminals, made two offers to mitigate the fees but she hasn’t seen similar offers from the operators of Centerm and Fraser Surrey Docks, who could not be reached for comment.
Snowden said TSI issued a notice on March 27 – the day truckers returned to work – that companies would only be charged for 10 days of storage if they got their containers off the dock by April 1. She said it issued another notice on April 1 that containers removed by April 4 would be charged for a maximum of 15 days of storage.
TSI spokeswoman Louanne Wong said the terminal operator is doing what it can for its customers. “We have been dealing with this issue on a one-to-one basis with all of our customers,” she said. “It’s complicated because there are so many different situations.”
Mooney said the storage fees charged by Port Metro Vancouver terminal operators are comparable with fees charged by other North American port terminals.
“Some ports are a little better and some are a little worse so it’s not really out of line,” he said. “The biggest issue is that when this port was shut down for a longer period in 2005 (for a work stoppage that lasted about five weeks), the terminals didn’t charge anything for storage.”
Mooney said Port Metro Vancouver should consider rolling back any lease payments paid by terminal operators during the recent labour dispute. “I have met with terminal operators and if Port Metro Vancouver would be willing to roll back their lease payments, maybe the terminals would be willing to roll back their storage fees,” he said.
Mooney said that while the storage fee issue might drive activity away from Vancouver to other ports in the short term, it’s unlikely to cause a permanent loss of business.
“We all like to sit back and say we’re going to lose business and that might happen short term but you can’t avoid using the port, as much as you’d like to,” he said. “We do a lot of business through Vancouver and have looked at every option available. We’re not going to disappear from the port of Vancouver because it’s just too valuable to us.
“Why would I send something to the Port of Seattle and it costs me an extra $1,000 a container when I can come right into Vancouver?”