Local airfreight companies yesterday criticized skyrocketing air-cargo rates from EVA Airways Corp (
"Increases by up to 50 percent on air-cargo shipments are totally unreasonable, since the cost of re-routing flights isn't that high," Yang Feng-yu (
The Taipei Airfreight Forwarders Association represents nearly 100 airfreight companies.
Yang made the statement yesterday after EVA Airways' announced a decision yesterday to raise its Europe-bound cargo rates 45 percent to 50 percent.
China Airlines also announced a 20 percent raise in its Europe-bound cargo rates.
Growing shipping demand and the fear of war delays are behind the price hikes.
Airfreight companies are expected to bear the brunt of the pinch.
"Most airfreight members have expressed difficulty in covering the price increase," said Pao Hsuen-chao (
The group said that a reasonable rate increase should be between 10 percent to 15 percent and go into effect no earlier than March 28.
"A 10-day preparation period is needed for companies to notify exporters and importers about the change," Pao said.
In response, the carriers said that they are not likely to change their plans.
Past the point of no return
"We will take their suggestion into consideration, but since we've already announced the increase, the chance of changing it now is very low," said Nieh Kuo-wei (
China Airlines also plans to stick to its decision.
"After evaluating market supply and demand, we think the 20 percent increase is reasonable," said Roger Han (
Shipping charges are not the only rising cost facing exporters.
Insurance rates for air and marine cargo to the Middle East have surged by up to 500 percent.
According to Mingtai Fire & Marine Insurance Co (明台產物保險), one of the nation's major commercial insurers, the company received a notice from Lloyd's of London on Friday announcing a new war-insurance policy in response to the US-led invasion of Iraq.
Lloyd's of London is an insurance provider, serving businesses over 120 countries.
The notice stated that cargo to Kuwait and Iraq will no longer receive insurance coverage. In addition, war insurance rates for cargo to Damman, Bahrain and Saudi Arabia have been raised from 0.05 percent to 0.25 percent or a 500 percent increase.
Rates for cargo headed to Dubai and Iran have also reportedly increased from 0.05 percent to 0.1 percent or a 200 percent surge, Lloyd's of London announced.
"The new pricing will be put into effect as early as today," said Chou Chi-hwa (
Rates for other destinationswill remain the same or face an additional 0.05 percent for war-insurance coverage.
Nevertheless, the impact on export businesses in Taiwan should be limited.
"Local exporters are less impacted by the new policy since the amount of products shipped from Taiwan to the Middle East is relatively small," Chou said.
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