shippers cry foul on freight class proposal

Anxious to keep what they see as a bad idea from becoming standard commercial practice, two shipper organizations have taken the unusual step of formally protesting a proposal made by the National Classification Committee's staff before it has even been docketed for formal consideration. The groups—the National Small Shipments Traffic Conference, or NASSTRAC, and the Health and Personal Care Logistics Conference—charge that a recent change in the National Motor Freight Classification has made more of their freight subject to what they consider unfairly high class ratings, thereby raising their rates. And they're worried that the NCC is now considering a proposal that would make it more burdensome to obtain an exemption.

The protest centers on shipments of mixed goods, which the shippers believe are already subject to exaggerated class ratings. Their objections stem from provisions in the National Motor Freight Classification (NMFC) under which pallets of mixed goods are classified at the highest class rating of any included commodity. As NASSTRAC stated in its filing with the National Classification Committee (NCC), these provisions mean that a pallet including 50 bowling balls and one box of pingpong balls would be rated as if it consisted entirely of pingpong balls. This obviously produces a higher class rating than using the average density of the palletized freight. Because higher class ratings generally mean higher freight rates, shippers are penalized by these provisions. For that reason, shippers are understandably reluctant to see even more pallets classified as mixed shipments.

In a letter to the National Motor Freight Traffic Association (which publishes the NMFC) and the National Classification Committee (which manages the NMFC), John Cutler, counsel for the two shipper groups, argued that the current mixed shipment rule already overstates the class rating of mixed shipments. Though he acknowledged that provisions of the NCC do contain an exception that allows shippers to have each item on a mixed pallet rated separately, Cutler argues that doing so in a way that complies with NCC rules is cumbersome. "You have to jump through a lot of hoops to identify every commodity on the pallet and comply with numerous requirements," he said during a telephone interview.

The prospective changes to the rules would make matters worse, he says. "I objected to taking a bad rule and making it more likely to apply to more shippers."

The NMFC itself is a publication that groups the commodities that move in interstate and intrastate transport into one of 18 classes based on factors like their density, stowability, ease of handling and liability. The classification is important to shippers because freight rates, including many contract rates, are tied to commodity classifications in the NMFC.