What is PSS? Why should you pay for the extra fees during the peak season of shipping?
There is an "unspoken rule" in the shipping industry - when the peak season arrives, there will always be an additional PSS (Peak Season Surcharge) on the freight bill. Shippers often complain: "Shipping companies raise prices as they say, should I pay this money?"
1. What is PSS?
Peak Season Surcharge (PSS) is simply an "overtime fee" temporarily charged by shipping companies during the peak season of transportation.
Why charge?
During the peak season, there are more cargoes and fewer ships. Shipping companies have to dispatch more ships and work overtime, which leads to skyrocketing costs, so they pass the pressure on to shippers.
Who pays?
In theory, it is borne by the booking party (usually the seller or freight forwarder), but it may eventually be passed on to the buyer.
2. When will PSS be charged?
European and American markets: Christmas (October-December), Black Friday (November), back to school season (July-August).
Asian market: before the Spring Festival (January-February), Double 11 stocking (September-October).
Emergency: Crazy rush for epidemic prevention materials at the beginning of the epidemic (2020), energy diversion caused by the conflict between Russia and Ukraine (2022).
3. How to calculate PSS? Can we not pay it?
Charging standard:
Charge according to container type (for example, 800 for 20GP container and 1200 for 40HQ container).
Some routes charge according to the value of goods (such as 3% of the value of goods for Asia-South America line).
"Overlord clause":
If the shipping company says to charge, it must be charged, unless you don't ship!
The contract often states that "the surcharge is subject to the notification of the shipping company", and the cargo owner has almost no right to negotiate.
4. How to pay less PSS?
Book in advance to lock the price: Sign a long-term agreement 2-3 months before the peak season and agree on the PSS cap.
Avoid popular routes: The PSS of the West Coast ports is high? Switch to the East Coast or Canadian ports (such as New York and Vancouver).
Flexible change of transportation mode: Emergency small-volume cargo can be transported by air or China-Europe train to avoid sea transportation congestion.
"Cooperate" with freight forwarders: large shippers can apply for PSS discounts from shipping companies in conjunction with freight forwarders (such as 30% discount if the cargo volume meets the standard).
5. Notes!
Low price trap: Some freight forwarders deliberately hide PSS in their quotations and only inform you when booking. The contract must state whether PSS is included.
Shipowners' internal competition: Shipping companies may charge PSS for major exporting countries such as China and Vietnam, and compare prices at different ports.
Sunny Worldwide Logistics has more than 20 years of freight forwarding history,and over half of staffs working in Sunny about 5-13years.Emergency solutions must be offered with 30 minutes if any. You may not find other companies like us in Shenzhen.
"Pseudo-peak season" charges: Some shipping companies also charge PSS in the off-season, keep historical freight records, and complain in time when abnormalities are found.
The shipping market is like a never-ending "offensive and defensive battle", and PSS is the "trump card" that shipping companies show in this game. If you want to solve the dilemma of high freight rates, complaining alone will not help. Only by going deep into the bottom of the rules and formulating systematic strategies can costs be controlled within a reasonable range.
