Kuala Lumpur: The Federation of Malaysian Manufacturers (FMM) has urged the government to delay the implementation of a proposed 30% increase in port tariffs, specifically for container handling and storage. This proposed hike is expected to significantly impact the cost of doing business for manufacturers and shippers.
According to BERNAMA News Agency, FMM President Tan Sri Soh Thian Lai revealed that the Port Klang Authority (PKA) and Johor Port Authority (JPA) are currently finalizing the tariff increases for Westports, Northport, and Port of Tanjung Pelepas (PTP). These proposals will be submitted to the Transport Ministry (MOT) for gazettement. With Port Klang handling 14 million twenty-foot equivalent units (TEUs) annually, the current container handling tariff is RM300 per 20-foot container. A proposed 30% increase would add RM90 per container, resulting in an additional RM1.26 billion in annual costs, directly affecting shippers and manufacturers dependent on the port for imports and exports.
FMM, w
hich has served as the permanent chair and secretariat of the Malaysian National Shippers’ Council (MNSC) since 2015, warns that higher tariffs could reduce Malaysia’s cost competitiveness. This could potentially redirect shipping traffic to neighboring countries with lower tariffs, thereby jeopardizing Malaysia’s role as a vital player in the global supply chain. The proposed tariff hike would raise Port Klang’s container handling fees to US$130 per TEU from US$120, aligning with or surpassing those of major competitors such as Singapore and Hong Kong.
Soh emphasized that Malaysian ports have traditionally been cost-effective options for shippers, offering competitive tariffs compared to regional counterparts like Singapore, Hong Kong, and India. However, the proposed tariff increase threatens to erode this advantage, creating a wider disparity with ASEAN neighbors such as Thailand, Vietnam, and Indonesia, where container handling fees remain more affordable.
According to Soh, storage charges beyond the fr
ee period would increase from RM15 per day to between RM51.75 (+245%) and RM95.40 (+536%) for a 20-foot import container. Similarly, for a 20-foot export container, rates are expected to rise from RM4 per day to between RM13.80 (+245%) and RM25.44 (+536%).
These significant cost increases could further burden the industry, exacerbate Malaysia’s declining competitiveness, and impede efforts to streamline trade and logistics operations. Soh called for transparent reviews of the proposed tariff adjustments, as the 30% hike could result in double charging shippers for costs that port operators are already obliged to cover.
Under existing concession agreements, port operators are contractually obligated to finance all development and infrastructure costs using operational revenues. Federal ports have shown sound financial performance, generating RM32.46 billion in revenue from 2019 to 2023. Transparent reviews are crucial to prevent shippers from bearing undue financial burdens for development and infrastructure
expenses.
Soh stated that while FMM supports the sustainable and equitable development of Malaysia’s ports, tariff revisions must be transparent, justifiable, and aligned with Malaysia’s economic objectives. He strongly urged MOT to defer the proposed tariff increase until a comprehensive review is completed, ensuring that Malaysia’s ports remain competitive and cost-efficient.