New NMFTA Rule That Directly Impacts Your Shipping Costs

Posted by George Muha on Oct 23, 2015 9:19:00 AM

You have to love it when freight carriers find a way to make more money!  Problem for shippers is that usually means their shipping costs are going up.  Listen up shippers, this article is for you. 

In recent months there has been an increase in shipments being re-classified while in transit with "NMFTA Item 680" (which was approved on 4/19/2014) at the heart of it and it is important the specifics of this item are brought to your attention.

Example of what qualifies under Rule 680.

Per NMFTA Rule 680:  "When less than 65 percent of the surface area for the lift truck skid, pallet or platform is occupied, the gross weight of the lift truck skid, pallet or platform and the commodity unitized or secured thereon, will be subject to the class applicable to either the lift truck skid pallet or platform or the commodity, whichever is higher."

What This Means in Simple Speak?

If the freight on a skid does not cover at least 65% of the skids surface area the freight will be classed as the skid itself and it will be re-classified as a "density item".  Depending on what's being shipped and the lack of density the unused pallet area is taking up, this could turn a Class 50 item and change it to a class 250 (as an example)...which could be quadruple the freight costs or more.

NMFTA

 Who Should Be Aware of this Rule?

Everyone!  This isn't for just folks with odd shaped items that don't fit on a pallet (although, they should have this rule tattooed on their forehead).  Everyone will throw a box on a pallet from time

Another example of a shipment that would be penalized under Rule 680.
to time to avoid shipping through a small package company.  This could be a deadly mistake (sorry to be so dramatic, but when you see the difference in price from a class 50 and 250, you'd want to be dead if you were paying the bill).  

My Carrier Isn't Catching These, Should I Still Be Concerned?

Yes!  The less-than-truckload industry is a copycat club.  If one carrier finds out how to make a few extra bucks, soon they all will follow.  More than one carrier is currently implementing this so it's only a matter of time before every carrier will be doing it.

Tell Your Vendors and Customers

Send this article to your vendors and customers so they are aware of this as well.  This is something everyone needs to know about.

I hope you find this helpful!  Feel free to reach out if you have any questions about this or anything else related to logistics.

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