Truck toll makes transport more expensive

Freight transport will become significantly more expensive this year. From July 1, the truck toll will be introduced, where trucks are classified by emission and must pay an amount per kilometer driven for their category. According to ING Research, transportation costs will therefore increase net by 7% to 8%. An increase in labor costs of over 4% will be added on top of that. Although transportation costs make up only a small part of the final price, it can still become a battle over whose margin this will affect. According to the entrepreneurs' association for the logistics sector Evofenedex, the introduction of the truck toll will affect not only carriers but also companies that have their goods transported. Although not all costs will be immediately passed on, according to ING Research: If companies manage it well, this will be passed on to customers through a contractual clause, but with annual contracts, this will have to happen mid-term. It cannot be ruled out that carriers may initially bear the costs themselves. From a survey conducted by Evofenedex, it appeared that almost half of the clients wants to negotiate about the kilometer toll. This indicates that immediate passing on of this will become a challenge, said ING. The bank earlier reported that consumers will notice little of the cost increase, as transportation accounts for only about 5% of the price of a product. Mark van den Dolder, co-director of the freight forwarder Inverness Transport, which arranges European transport of various products such as potatoes, onions, carrots, coffee, and cocoa, indicated upon request that they can pass on the higher rates in the Netherlands to their customers. Maybe the farmer and the transport company will fight over who has to bear the costs. Farmers are not doing well and transport companies do not have the highest margins either. In this respect, for agricultural entrepreneurs, especially for potato growers, it is an unpleasant year that the truck toll is being introduced, van den Dolder indicates. There is a surplus with potatoes, where farmers must sell. I am afraid that the big players, the supermarkets, will exert pressure and that farmers will bear the costs. How high the additional transportation costs will be largely depends on the number of kilometers on toll roads and the type of truck, Evofenedex states. For a Euro 5 truck, the highest rate of €0.236 per kilometer applies, for Euro 6 it is €0.201, while the rate for an electric truck is significantly lower at €0.038 per kilometer. Carriers with a (partly) electric fleet pay significantly less per kilometer. According to Rico Luman, sector economist for Transport and Mobility at ING, with the kilometer toll for road carriers, it becomes quite interesting to look into the deployment of electric trucks. Electric trucks are according to van den Dolder an option within the Netherlands, but not when you have to load to Spain (90% to 95% of their transport passes through the rest of Europe). The lack of charging infrastructure was for the European Commission the main reason at the end of last year to refrain from making it mandatory for carriers to purchase electric trucks. Container rates decline further The World Container Index from Drewry decreases this week for the sixth time in a row, down 1% this week. Spot prices on routes between Asia and Europe continue to fall. Container transport from Shanghai to Rotterdam became 1% cheaper, as did to Genoa. Drewry expects further decline. Trump wants high port fees for foreign ships It had been quiet around the plans of U.S. President Donald Trump to revive the domestic shipbuilding industry, but last Friday America's Maritime Action Plan was released. Where it previously concerned port fees for vessels built in China, this proposal states that a tax must be levied on all ships built abroad (the vast majority) that call at a U.S. port. The tax should amount to 1 to 25 cents per kilo. Lars Jensen, CEO of Vespucci Maritime, calculates on LinkedIn that at 1 cent the tax amounts to an average of $150 per FEU (container of 40 feet), and at 25 cents it amounts to $3,750 per FEU. He has also calculated what the payback time is for a ship built in the U.S. at the highest port fees. The difference in purchase price is significant: $50 million versus $330 million. This results in a payback period of five to six years. With a delivery time of three to four years, a shipping company must be able to rely on future presidents not lowering or reversing the fees for the next eight to ten years, Jensen indicates. He concludes: Even at the high tax, it is unlikely that ships built in the U.S. will become truly attractive. A major acquisition also took place in container shipping. The (mainly) German shipping company Hapag-Lloyd has acquired the Israeli ZIM. According to the Alphaliner Top 100, Hapag-Lloyd is currently the fifth largest container shipping company with a market share of 7.1%. ZIM ranks tenth with 2.1%. This way, the shipping company remains the fifth largest even after the acquisition.