Import-export trade faces setback

• Fuel Price Hike Triggers 10 Percent Charge at Private ICDs
• Port Berth Operators Demand Higher Handling Charges

Rafiqul Islam Selim

The recent sharp rise in fuel oil prices has hit the country’s overall import and export activities. The government raised diesel prices by 20 taka per litre. Private Inland Container Depots responded by raising charges across six service categories by nearly 10 percent starting Monday.

Port berth operators have also demanded higher charges. They say repeated fuel price hikes have created financial strain in running container berth operations at Chattogram port. The Berth Operators, Ship Handling Operators and Terminal Operators Owners Association made this demand.

Association President Mr. Fazle Ekram Chowdhury sent a letter to the Chattogram Port Authority Chairman yesterday raising this demand. Import and export stakeholders say three fuel price hikes in eight months, combined with these charge increases, will raise import costs. They warn this will raise prices of imported goods, especially consumer products, and hurt ordinary consumers. They expect this to fuel inflation further and raise the cost of living.

The government suddenly announced a 20 taka per litre fuel price hike on Sunday night. The hike took effect from midnight. The Bangladesh Inland Container Depot Association, or BICDA, cited this fuel price hike and announced a 9.85 percent increase across six service charges. These charges cover import, export, and empty container handling. BICDA issued a circular putting the new charges into effect from Monday, in line with the government’s latest fuel price increase.

BICDA said diesel prices rose 17.4 percent, driving up fuel related operating costs at private ICDs and off docks. The association said this forced it to raise six specific charges by 9.85 percent. BICDA Secretary General Mr. Md. Ruhul Amin Sikder said the association decided to adjust for the extra fuel expense this way.

The six charges cover empty container transport between Chattogram port and the ICDs, empty container transport between Patenga Container Terminal and the ICDs, loading and unloading of empty containers, loading and handling of export goods, verified gross mass processing for export loaded containers, and import goods delivery.

Under current tariffs, the export goods stuffing and handling package charge stands at 8,056 taka for a 20 foot container and 10,742 taka for a 40 foot container. About 93 percent of export goods pass through 21 private ICDs located in and around Chattogram before loading into containers for export through Chattogram port. These ICDs also handle a portion of the port’s import containers. About 21 percent of import containers move from the port to private ICDs, from where importers receive their goods.

Empty import containers also travel to these private container depots after direct port delivery. The depots store these empty containers for a set period and then use most of them for export loading. Private container depot owners raised their charges once before last year as well.

Meanwhile, berth operators have demanded a fare adjustment to reflect the current fuel price hike against their contract rates. Their letter to the Chattogram Port Authority Chairman notes that Chattogram port called an open tender for container berth operations on January 19, 2022. Berth operators submitted their bids based on fuel and other commodity prices at that time.

Diesel prices then suddenly rose by 34 taka per litre on August 5, 2022. Operators applied to the port authority for a rate adjustment at that time, but the letter states no action followed. Diesel prices later rose another 15 taka per litre. This brought the total fuel price increase to 49 taka per litre compared to the time of the original bid.

The most recent hike added another 20 taka per litre starting September 20. Diesel now costs 135 taka per litre. The association notes that diesel cost 80 taka per litre when they submitted their original bid on January 19, 2022.

This means diesel prices have risen by 55 taka, or about 69 percent, since then. The letter states that member berth operators now find it hard to manage financial strain while running berth operations. It notes that container handling work depends entirely on transport, so fuel price hikes hit this sector directly.

The association points out that other sectors have already adjusted their rates for the fuel price hike. It has asked the Chattogram Port Authority Chairman to urgently arrange a similar rate adjustment for container handling contract rates in line with the current fuel price increase.