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NEWS

Shanghai Port Trucking Stoppages Ease (Monday, April 25, 2011)

Government offers fee concessions, shippers likely face higher costs

A five-day old trucker strike at the port of Shanghai eased significantly over the weekend following intervention by the mayor and a series of concessions offered to drivers, including a rollback of fees that had prompted work stoppages.

But local news reports indicated some disruption continued into Sunday and that there could be more disruption this week. According to reports, some drivers upset over fees and rising fuel costs rejected concessions by the Shanghai government.

The rising costs are coming amid weakening container freight rates, which affect how much truckers earn hauling containers between manufacturing centers and marine terminals.

One well placed local source said the strike ended following the personal intervention of Shanghai Mayor Han Zheng, who called an emergency meeting of the key players in the port.

The government issued a statement Saturday saying, "To promote the development of Shanghai's container shipping routes, and relieve the pressure that rising costs and fees have placed on transportation businesses, the city government has researched and agreed to new regulations on the fee-collecting behavior of Shanghai's container shipping companies, to clean up all kinds of unreasonable fees."

That suggested a greater share of trucking costs would have to be borne by shippers instead of transport providers.

The strike has led to container backups at inland manufacturing such as Suzhou that depend on trucks to move containers to the Shanghai terminals at Waigaochao and the Yangshan Deepwater terminal off the coast. Given the volume that needs to move and the distances containers need to travel, the factory-port transportation link is stretched to the limit.