The Tribune

By NATARIO McKENZIE

Tribune Business Reporter

nmckenzie@tribunemedia.net

BAHAMIAN retailers and wholesalers have warned it is “not good for the country” to be serviced by only two major shipping carriers, expressing concern they would have “nowhere to turn” in the event of future freight rate hikes.

Phil Lightbourne, owner of Gladstone Road-based Phil’s Food Services, told Tribune Business that with Mediterranean Shipping Company (MSC) and Tropical Shipping the only two major freight carriers left in the Bahamian market, importers would have to either “pay the price” or “buy your own boat”.

Crowley recently announced it had been unable to cover “significant” cost increases on its Nassau route and would discontinue its Jacksonville-Nassau service on August 2. Atlantic Caribbean Line (ACL), Seaboard Marine and G&G have all discontinued their Nassau routes in recent years.

“We have nowhere to go,” Mr Lightbourne said. “Once those two come together and give you a rate, if you want to be an importer you have to pay the fees or find your own boat. That’s a clear fact.

“The fees at the port are very high and those two shipping companies are mega. Not a lot of people can compete against MSC. It’s sad to see Crowley go; I think they were an awesome freight carrier, but once MSC got into Jacksonville that really cut Crowley’s throat. They were smart, they knew they couldn’t compete against MSC, so they did the honourable thing and pulled out.”

Mr Lightbourne added: “It’s not good for us. It’s going to put the freight up high. Those two carriers have to pay the port, they have to maintain that port. Unless all the companies decide to buy a boat there is nothing else you can do.

“Doing business in the Bahamas has gotten very costly and there aren’t many businesses that can sustain the amount of fees coming their way in this dying economy. The end result is that unless you get your own boat you have to pay the price.”

Wade Thompson, Customs broker for the Super Value food store chain, told Tribune Business: “It’s a major concern. I think it’s a concern not just for retailers and wholesalers but the entire society. We should not have come to a situation like this.

“ I think with the advent of the port, the fees that were levied were just too exorbitant for many. We only have a market of a particular size, and you have a fierce competition between the carriers. I think it became less profitable for many of them. Right now we have fewer options.”

Mr Thompson said Super Value had decided years ago not to put all its eggs in one basket, which was why it conducted business with several carriers.

“It made good business sense to help all of the carriers since they provided employment to other Bahamians, so we shared the business and we would stick with those giving us the best rates,” he explained.

“It also allows you, should you have a problem with your main source, you can always do business with the others that would be willing to match whatever rate you were getting.

“What you find now is that there are just two major carriers out of the United States. That cannot be good for the country. It seems like we are almost creating another monopoly. Competition is always the way to go.”

Arawak Port Development Company’s (APD) chief executive, Michael Maura, told Tribune Business last week that Crowley’s decision to exit the Bahamian shipping market was driven “110 per cent by competition”, revealing that the collective cargo capacity to Nassau was currently 52 per cent empty.

Mr Maura said Crowley’s pull-out had been prompted by its “deeper pocketed” rival, MSC, starting a direct Jacksonville-Nassau service of its own two weeks ago.