Private container depots in Bangladesh have imposed surcharges of up to 9.85 percent on six fuel-dependent services after the government raised the diesel price by BDT 20 a litre, while lighter vessel operators and port handling contractors have also sought to adjust their rates.
The Bangladesh Inland Container Depots Association (BICDA) announced the surcharge in a circular on Monday, citing higher depot operating costs after diesel was priced at BDT 135 a litre, up from BDT 115.
The surcharge covers the haulage of empty containers between Chittagong port and the ICDs, and between Patenga Container Terminal and the ICDs, including loading and unloading. It also applies to export container stuffing and handling package charges and to verified gross mass charges.
Ruhul Amin Sikder Biplob, the association’s secretary general, said diesel had risen 17.4 percent and the surcharge was set as a percentage of the rates depots agree bilaterally with their customers. No fixed rate had been imposed, he said, and operators able to provide or receive services below the maximum surcharge were free to do so.
Chittagong’s 21 private depots handle export cargo before it is sent to the port, and part of the import cargo is also cleared at the depots. About 1,000 container-carrying trailers and 250 pieces of equipment are used in these operations, consuming an average of 70,000 litres of diesel a day.
Traders say the successive levies will raise the cost of transporting and managing imports, with the burden ultimately falling on consumers. For exports, higher transport and handling costs will weigh on the competitiveness of Bangladeshi goods in international markets.
Khairul Alam Suzan, a former director of the Bangladesh Shipping Agents Association, said setting charges without final talks with stakeholders “lacked justification” and would add to pressure on exporters.
Syed M Tanvir, managing director of the exporter Pacific Jeans Group, said the industry was passing through a difficult period, which the government recognised.
“We can’t raise prices with buyers the way ICDs and other service providers are immediately increasing charges,” he added.
Tanvir said export deals are negotiated over every cent and unit prices have fallen this year from last, warning that rising operational costs mean businesses are steadily losing their competitive edge.
The impact is also reaching the movement of goods from Chittagong port’s outer anchorage to the rest of the country. About 50,000 to 60,000 tonnes of cargo are transferred daily from large ships to lighter vessels, and about 75 million tonnes are moved annually along inland river routes by more than 1,000 such vessels, according to the Bangladesh Water Transport Coordination Cell.
Parvez Ahmed, a spokesman for the cell, said: “A vessel needs about 3,000 litres of diesel to reach Dhaka from Chattogram. Fuel prices have gone up, so vessel freight rates will rise; that’s the reality. Steps are being taken to adjust rates accordingly.”
Meanwhile, the Berth Operators, Ship Handling Operators and Terminal Operators Owners Association has demanded that rates under existing contracts be adjusted.
In a letter signed by its president, Fazle Ekram Chowdhury, the association said diesel stood at BDT 80 a litre when tenders were called on January 19, 2022, and has now reached BDT 135, an increase of about 69 percent.
Chowdhury said operators had been given no opportunity to adjust rates despite repeated fuel price hikes, and the latest increase had added to their financial burden. The association has asked the port authority to take steps to adjust the rates.
Amirul Haque, Seacom Group managing director and president of the Chittagong Chamber of Commerce, said: “Higher fuel prices will raise the cost of transporting industrial raw materials and consumer goods. But we also need to recognise the reality. The government cannot easily sustain large subsidies for long. That would create a different set of challenges.”