6/25/2010
Ocean Shippers: Transpacific Freight Rates Still Headed Up; New August Surcharges

The 15 members of the Transpacific Stabilization Agreement group of carriers forecast even higher shipping prices despite recent increases, IFW / Freight & Logistics News Service reported.

TSA pointed out that shipping rates still have not reached 2008 rates.

A peak season surcharge of $400 beginning August 1 has been recommended by the TSA.
Deep-sea carriers reported 2009 losses totaling US$15 billion.

“While revenue gains made by carriers in recent months have made an important contribution to carrier balance sheets, carriers say the increases achieved in the current contract round still do not fully restore rates to the levels of late 2008, let alone provide for long-term viability and service expansion,” the TSA stated. “In addition, to cover the costs of the expected robust peak season, individual TSA lines reaffirmed implementation of a previously announced PSS.”

YM Kim, Hanjin CEO told reporter Damran Brett of IFE that “after last year, no carrier is going back to operating vessels that are under-utilized, and at non-compensatory rates.”

“More than ever, they [carriers] need the PSS to prepare for service contingencies and to meet schedule and delivery commitments on a sailing-by-sailing basis. And also to cover increased existing operating expenses, and the increased cost of capital.”

Shipping industry consultant Drewry reported the Hong Kong-Los Angeles container rate benchmark hit $2,607 per 40ft container this month. That is 19% higher than the previous week and 182% higher than the same week in 2009.

The TSA also noted a shortage of vessels and equipment. Shipping lines are adopting a variety of responses, including adding “extra loaders” which return from the U.S. with empty containers. ©2010 GlobalFastenerNews.com

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