$4,000 Cargo Surcharge Sparks Outrage Among Maritime Stakeholders
There seems to be tension in the nation’s maritime sector following the introduction of up to a $4,000 war surcharge on Nigeria-bound cargoes by MSC Shipping Company.
Last week, MSC, in a post on its website, announced that with effect from March 5 till further notice, it will introduce a war risk surcharge of up to $4,000 for cargo shipments to Nigeria, other African countries, and Indian Ocean islands from the Indian subcontinent and Gulf countries.
“The evolving security situation in the Middle East is affecting maritime traffic in the Straits of Hormuz and Bab El-Mandeb and causing disruption throughout our network. Consequently, MSC Mediterranean Shipping Company will implement a War Risk Surcharge for all cargoes moving from the Arabian Peninsula (Bahrain, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, UAE to West Africa, East Africa, South Africa, Mozambique, and the Indian Ocean Islands.
“The surcharge will be effective as of 05 March 2026 (gate-in date) local time until further notice, and will be charged as follows: $2,000 for 20ft, $3,000 for 40ft, and $4,000 for reefer cargoes. MSC continues to closely monitor the situation and is working with relevant authorities to ensure the safety of its operations. We thank you for your understanding and patience, and we will keep you updated with further developments,” it stated.
Reacting to the development, a former acting National President of the National Association of Nigerian Licensed Customs Agents, Mr Kayode Farinto, in a chat with The PUNCH on Thursday, said shipping companies would likely add the surcharge.
“Because, whether you like it or not, there’s nothing anybody can do. Any shipping company that is bringing cargo will want to charge, and most of the insurance companies are dropping insurance policies because of this war.
“And the route that they are taking is being taken over by Iran. So it’s expected, except there should be a reasonable thing that they want to charge for the insurance. $4,000 is high, but it’s expected, it’s normal. There’s nothing anybody can do about it. The whole world is at war. That’s what it means. So if you are bringing your goods and taking a high risk, because they cannot take the Straits of Hormuz now, they will have to go and manoeuvre and take another route, maybe to South Africa,” Farinto said.
According to him, the development will definitely lead to a drop in cargo. “It means that our cargo volume will drop, but nobody wants to take risks. Secondly, the freight will increase, and thirdly, the goods will increase. Because whoever is managing to bring goods will add the overhead costs and the insurance premiums. So definitely, things will start increasing.”
Farinto added that the development is likely to lead to an increase in the price of products from the Dangote Refinery.
He added that the impact would be felt more in the coming weeks. Also speaking, the Chief Executive Officer of the Centre for the Promotion of Private Enterprise, Muda Yusuf, admitted that the development will affect trade in the country, especially the region.
“It’s going to affect trade significantly because cost will go up, and in fact cost has gone up and may even go higher. And if the cost is going up that much, then the volume of trade will drop. If the volume of trade drops, that is less business for the maritime industry.
“Because with that kind of cost, I don’t know how many businesses will be viable anymore. So this part will be very severe in the maritime sector. And if there is a drop in activities in maritime, that means loss of jobs, loss of income, and a whole lot of issues that will affect the maritime sector,” he said.
Also speaking, the Secretary of Manufacturers Association of Nigeria Export Group, Dr Benedict Obhiosa, said, “The recent increment in charges by the Mediterranean Shipping Company will lead to further weakening of the competitiveness of manufactured products in the international market space.
“However, exporters may decide to consider exporting by road as there is an alternative. In general, the hike in prices will discourage further export and that will, by extension, affect the volume and value of non-oil export in this concluding quarter and even the next if the problem is not resolved by the Nigerian government and shipping authorities.”
Meanwhile, the Africa Association of Professional Freight Forwarders and Logistics of Nigeria has expressed grave concern over the newly introduced surcharge.
In a statement on Thursday signed by its National President, Frank Ogunojemite, obtained, APFFLON described the surcharge as a major economic “shock that could further worsen Nigeria’s already fragile import-dependent economy.”
He noted that Nigeria relies heavily on maritime transport for over 80 per cent of its international trade, “meaning that any sudden increase in shipping costs automatically translates to higher prices of goods, inflationary pressure, and increased cost of doing business.”
Ogunojemite warned that the surcharge will have far-reaching consequences for Nigeria’s maritime sector and the broader economy, including “sharp increases in food and pharmaceutical prices. Refrigerated containers (reefers), which carry essential goods such as frozen foods, dairy products, fish, and pharmaceuticals, will be the most affected by the $4,000 surcharge.”
He urged the Federal Government, the Ministry of Marine and Blue Economy, the Nigerian Shippers’ Council, and other relevant maritime regulators to urgently engage international shipping lines and global maritime stakeholders to mitigate the impact of these war-induced surcharges on Nigerian trade.