Indonesian Logistics and Forwarders Association (ALFI/ILFA) urges shipping lines to be transparent if they will adopt the special floating booking space system for domestic shipment.
As reported earlier, Supply Chain Indonesia (SCI) informed that some domestic shipping companies have planned to apply the system in January 2022. The system is applied by national shipping to its customers, both direct (end) customers and indirect customers (forwarders).
ALFI Chairman Yukki Yukki Nugrahawan Hanafi warns that the system will create a further sky rocketing freight rate in domestic market while on the same time the system creates uncertainty in space availability.
“This so regretful. Even, before the system (floating booking space system) is adopted, the domestic freight has been sky rocketing, increasing up to 80%. This is due to unavailability of vessel space,” Yukki said in a press statement today, Monday, 13 December 2021.
Yukki explained that the freight rate has been variously increasing in domestic routes this year, from the beginning of 2021 to date. The routes with high volume of Jakarta-Medan and Jakarta-Makassar increased by 30-60% and 30-80%, respectively. This freight increase, he said, would continue next year (2022).
Yukki predicts the domestic freight rate will continue to increase until mid-2022. Therefore, the cargo owners and forwarders members of ALFI as well are also waiting for the transparency of the increase in freight from shipping companies.
“I have informed this issue to all executive boards of ALFI Chapters throughout 34 provinces nationwide. We have asked them (executive boards of ALFI Chapters) to forward this information to cargo owners,” he said.
This is because the increase in domestic freight has had impacts on several companies. “Food and beverages producers have indicated to increase the price of their goods,” Yukki reminds, adding that some domestic commodities will also increase. “This condition cannot be avoided due to the increase in freight,” he said.