Leading international shipping lines have imposed huge surcharges for container freight rates from the Mideast Gulf in response to the escalating Iran war, pushing up delivered bitumen prices because heated bitutainers, drums and bagged product are moved in containers.
The gains are largely notional, as suppliers and importers note negligible flows from Mideast Gulf ports and terminals, including on bitumen tankers, but are especially worrying for east African importers who are reliant on Mideast Gulf drummed supplies and some bulk tanker shipments.
European suppliers said they too had been hit by hefty freight rate rises for their deliveries from west European ports to destinations like west Africa and the Indian Ocean islands.
Geneva-based MSC and UAE-headquartered DP World said this week they were imposing War Risk Surcharges with effect from 4 and 3 March respectively, of $2,000/20ft container, $3,000/30ft container and $4,000/40ft container. These apply to "all cargoes exported from UAE trans-shipments hubs in Jebel Ali and Abu Dhabi to west Africa, east Africa, south Africa, Mozambique and the Indian Ocean islands."
MSC said the situation in the Middle East is "affecting maritime traffic in the straits of Hormuz and Bab el-Mandeb and causing disruption throughout our network."
Suppliers of drummed bitumen, which typically moves in 20ft containers, from Jebel Ali to east African destinations, said the surcharges would nearly double shipping costs for Iranian drummed product repackaged in the UAE.
Rates for such indirect flows had been $2,300-2,450/20ft container before the 28 February start of US and Israeli military action against Iran. The rise will push up drummed freight rates to east Africa to $215-222.5/t.
Some suppliers said they expect a slow resumption of Jebel Ali loaded exports in the coming days, barring any further war escalation.
Regional bitumen suppliers said no change has yet been indicated by Iranian state-owned IRISL for direct shipments of drummed or bagged bitumen from Bandar Abbas, the country's key bitumen export point.
As of late February, IRISL direct shipping rates to Mombasa and Dar es Salaam were in the $1,100-1,400/20ft container range ($55-70/t). Argus drummed freight assessments, calculated based on direct and indirect flows, were $90-100/t and $95-110/t respectively in the week ended 27 February.
Shipping lines' war risk surcharges for Mideast Gulf container movements to Indian destinations via Hormuz are $1,000-2,500/20ft container ($50-125/t). A supplier of European bitutainers to west African and Indian Ocean islands destinations said rates on those routes had more than doubled since the war began to around €4,000/container, from €1,800/container until late February.
