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Shipowners reduce freight as piracy drops half
The rising cost of freight to Nigeria and other West African ports which pushed the price of imported products such as oil, wheat, steel and maize up has dropped. The International Maritime Bureau explained that the drop was due to the action of the naval forces in the gulf of Aden that helped to reduce cases of piracy in the first half of 2010.
The activities of pirates forced shippers to incur higher importation
costs and high insurance fees as they navigate through longer routes.
The activities of piractes, it revealed, set the stage for expensive
imported goods as importers pass the additional costs to consumers.
Shipping lines in March had introduced a new insurance premium, known as
the general cartage insurance for goods destined for Mombasa port on
the resurgence of piracy in the Gulf of Aden.
Also some surcharge were introduced to West African bound imports by shipping lines,such as Maersk Line, K Line and CMA CMG.
For instance, piracy risk cover on a voyage from South Africa to India
has been adding $30,000 to the basic insurance cost, according to
shippers’ estimates.
The shippers also introduced a special congestion surcharge of $100 up from $20 per day on delay in cargo clearance.
The IMB had noted joint surveillance operation led by Europe and US has deterred the attacks.
The heavy storm in the seas stretching from June to September has also
made it difficult for the pirates who use small boats to launch attacks.
“The reduction in the incidents can partly be attributed to unsuitable
(turbulent sea surface) conditions in the ocean at this time of the
year, and military intervention, even though this has not been enough to
significantly contain the incidents,” said Mr Henry Langat, the
managing director of Kenya Shippers Council.
He added that the freight costs, notably insurance premiums, are set to come down should the attacks continue to come down.
At 196, the attacks are still high to those of the first half of 2008 and 2007 at 114 cases and 127 respectively.
Incidents of piracy along the Indian Ocean coast dropped in the first
half of the year on increased surveillance by allied navy forces and
poor weather, offering relief to importers and consumers of imported
goods.
Data from the International Maritime Bureau (IMB) indicates that piracy
attacks dropped 196 cases in the six months to June, down from 241 cases
in the same period a year earlier.
Source: Nigerian Compass
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