INSA Agrees on the Amount of Fuel Surcharge at the Port

INSA has agreed on the fuel surcharge that PT Pelabuhan Indonesia (Pelindo) will be charged to ships using tugboat services.

Sea logistics costs will increase in line with additional costs due to fuel surcharges. The Indonesian National Shipping Owners Association (INSA) has agreed on the amount and calculation of the fuel surcharge to be charged.

PT Pelabuhan Indonesia (Pelindo) will charge a fuel surcharge to ships using tugboat services. 

“Fuel surcharge occurs due to the increase in the price of fuel used by tugboats. Service users represented by INSA have agreed upon the formula for increasing fuel surcharge,” said INSA Chairperson Carmelita Hartoto to the media on Friday (12/8/2022).

Carmelita said that the fuel surcharge policy would impact the cost of ocean logistics. However, Carmelita assessed that the increase in marine fuel prices or MFO should still be implemented.

Based on InfoPricesBBM, the domestic MFO price is the same or Rp. 19,500 per liter on August 1-14, 2022. This figure is 62.5% higher than the price of MFO in the same period last year, which was Rp. 12,000 per liter.

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Meanwhile, the current MFO price is recorded to have increased by 52.79% from the initial 2022 average price of IDR 12,762 per liter. Carmelita said that the determination of the fuel surcharge amount is the difference between the current diesel price and the diesel benchmark at the beginning of 2022.

Carmelita has not conveyed that INSA and Pelindo have prepared the formula for calculating the fuel surcharge. According to him, the calculation of fuel surcharge will depend on the specifications of the engine installed in the stretcher used and the length of use.

Carmelita said that the average fuel surcharge for tugboat services is 15% – 25% of the tug service fee. The simulation is that if the tug service fee is Rp. 20 million for single use, the fuel surcharge charged to the vessel owner for the tug service is Rp. 4 million.

In addition, Carmelita explained that the fuel surcharge amount would be dynamic following the MFO price issued by PT Pertamina every 15 days.

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He explained that the fuel surcharge amount would be dynamic following the MFO price issued by PT Pertamina every 15 days.

“Every time the ship’s fuel price increases by IDR 10,000, the amount of fuel surcharge changes. Fuel surcharge will be stopped if fuel prices fall again to the same as the initial position in 2022,” said Carmelita.

Chairman of the Indonesian Logistics Association (ALI) Mahendra Rianto said the current character of the ocean logistics business allows fuel surcharge to be applied to ship owners. This is because one vessel carries at least 5,000 units of containers in one trip.

In other words, Mahendra said the costs to be borne by the vessels would be divided into the transportation costs of the 5,000 container units. Thus, the impact that ocean logistics service users will enjoy is still measurable.

However, Mahendra reminded the government to keep the cost of fuel in the land logistics business. The reason is that land logistics costs contribute up to 40% of the total logistics costs in the country.

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“The composition of sea logistics costs is not as high as land logistics costs. Let’s say that rice is distributed throughout Indonesia. The largest logistics cost is by land,” said Mahendra.