Yang Ming has reached an out of court settlement with a shipper that claimed it was a victim of pandemic-era price manipulation.
The complaint was lodged with the US Federal Maritime Commission (FMC) by Delaware-based food shipper MSRF last August, alleging the Taiwanese carrier refused to provide the full capacity agreed in service contracts – “instead, forcing MSRF to buy space on the inflated spot market”.
It alleged: “Yang Ming refused to provide more than a fraction of capacity requested and needed, even though it overall has continued to operate at, or near, pre-pandemic capacity.
“Our written service contract with Yang Ming included minimum quantity commitments to tender cargo from various points in Asia for Yang Ming to transport via ocean vessels to the US at agreed intervals and for agreed prices.”
“Yang Ming then proceeded to engage in a practice of refusing to perform full commitment under the service contract, instead forcing MSRF to buy space on the inflated spot market.”
At the time, a container that, pre-pandemic cost approximately $2,700 to ship from China to the US west coast, was being quoted at $25,000 or more and, in the period under scrutiny – May-December 2021 – Yang Ming carried just four of the 100 contracted feu boxes, claimed the shipper.
MSRF said as a result of “the carrier’s practice of selling MSRF-contracted space on the spot market”, it had lost in excess of $1m and was seeking “remuneration and damages”.
But, following “arms’ length negotiations”, the two parties submitted a joint motion in support of a confidential settlement, which the FMC approved last week.