PPG Freight Surcharge FAQ's


What is a freight surcharge and why is it charged?

A freight surcharge is a variable additional charge set to recover cost anomalies in an established supply chain. The surcharge is charged to recover significant price increases the supplier is subject to due to unusual and uncontrollable events.

How does the freight surcharge work?

Each month, Pro-Pac measures changes in the price of international freighting of its imported goods and materials. The impact is weighted across imported goods and materials brought into Australia to service our customer needs. The surcharge allows us to recover abnormal cost uplifts in a specific area of cost without passing on a permanent price uplift.

How is the surcharge calculated?

The surcharge reflects an increase in the Drewry Global Freight Index against a baseline of 2020 calendar year average against the % of our cost base that is driven by international freight on our materials or imported goods.

How often will the rate be changed?

For uncontracted customers, the freight surcharge will be reviewed and calculated up or down monthly.

How will customers know the amount of the surcharge?

Pro-Pac will advise the following month's freight surcharge on the website.

How can I (as a customer) find out for myself if the freight surcharge has changed?

The freight surcharge changes on a monthly basis. The revised freight surcharge index movements will be communicated via this internet page. It is a quick and readily accessible means of communicating the new surcharge to customers and employees of customers, to enable you to stay informed about freighting costs.

Will pricing increase or decrease each month be based on the rate?

Pricing will be adjusted monthly. New pricing will start on the 1st of a month. We will endeavor to provide 30 days’ notice of any price change.

Other suppliers have not spoken to us about a Freight surcharge.  Why should we stay with you?

The surcharge reflects the increase in demand for sea-freight in a period where COVID-19 pandemic has removed air-freight capacity from the market. We would anticipate as the world begins to return a COVID-19 normal life, international flights will return, and some supply chains will return to air. This will reduce the current pressure on sea-freight and progressively normalise price. It is unknown how long this will take. Our surcharge will reflect the ups and downs of this market evolution.  

Other suppliers have not spoken to us about a Freight surcharge. Why should we stay with you?

There is significant pressure on the import supply chain. As a significant importer we have negotiated long and hard and are no longer to continue absorbing these costs. We are implementing a surcharge which is a temporary recovery of excess cost to continue our secured supply chain. All suppliers in this sector are facing these challenges and may be temporarily absorbing or are passing it through via price increase.

How can I lock in orders and pricing for a period of time?

Please discuss your requirements with your Account Representative.

PPG Certifications


Contact PPG

Corporate Headquarters
83-85 Banbury Road, Reservoir, VIC, 3073
PO Box 441, Reservoir, VIC, 3073

Phone: 1300 PROPAC | 1300 776 722
Fax: +61 3 9269 5199