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Union Pacific levies surcharge from California of US$1,000 April 25

THE Union Pacific Railroad (UP) is raising the surcharge on excess contract cargo of low-volume shippers from US$250 to $1,500 and instituting a new $1,000 surcharge for large and medium-volume shippers in Los Angeles and Lathrop, California, effective April 25, the railway announced

19 April 2021 - 19:00
THE Union Pacific Railroad (UP) is raising the surcharge on excess contract cargo of low-volume shippers from US$250 to $1,500 and instituting a new $1,000 surcharge for large and medium-volume shippers in Los Angeles and Lathrop, California, effective April 25, the railway announced.

The $1,500 surcharge on low-volume shippers and $1,000 on medium- and large-volume shippers applies on each container above the caps. If the shipper stays below the cap, no surcharge applies.



UP said in its announcement it is seeing 'increased demand for domestic container capacity' and the surcharges are aimed at providing 'more capacity towards committed baseload volumes.'



It's the same reasoning the railway used in 2020 to assess a record-breaking $5,000 surcharge on aggregate rates and $1,500 on BCO-specific rates in Los Angeles, and $1,500 and $850, respectively, in Lathrop and Oakland.



Last month, UP instituted a $250 surcharge on low-volume shippers and raised the number of annual loads to be taken out of the low-volume category, known as the aggregate rate, but made no move on the large- and medium-volume customers with BCO-specific rates.



It's the first time UP has instituted such a peak-season fee before the summer. UP declined to comment on the surcharge because it is in a quiet period prior to the company's first quarter earnings announcement on April 22.


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