PACIFIC LINES STICK TO PRICE RISES DESPITE TRADE SLOWDOWN
Major container shipping lines of the Transpacific Stabilization Agreement said they still plan to adopt scheduled recommended rate increases, peak season surcharges, fuel charges and a new chassis usage charge starting in May, despite the slow-down in the eastbound Asia-to-U.S. container trade.
TSA carriers met during the past week to review market conditions and concluded that “the U.S. economy, while slowing down, shows continued strength,” a spokesman for the carrier group said.
The TSA carriers said last October that they agreed on voluntary, non-binding rate increase recommendations for tariff and service contract rates of $525 per 40-foot container from Asia to U.S. West Coast ports and $600 per FEU to East Coast ports via all-water or mini-landbridge, effective May 1.
The ocean carriers cited increased feeder vessel, inland transport, longshore, equipment repositioning and other cost increases. They reiterated the need for a new, more accurate fuel surcharge calculation formula, and for the ability to pass through costs associated with carrier-provided truck chassis in the United States.
In a statement Tuesday, the carriers said this year would see a return to normal growth in the 5-6 percent range, on top of two years of record cargo demand.
By contrast, January-November 2000 volumes were up 14 percent over the same period in 1999.
The TSA carriers sought to play down reports of a potential downturn in the eastbound market, as a large number of new ships are due to be deployed in an already soft market.
“New vessel capacity is expected this year, but not before the peak shipping season begins in late summer, absorbing a large portion of it,” a spokesman for the carrier group said.
“While carriers recognize that recent market conditions have not been particularly favorable for many importers, it must be remembered that most service contracts soon to be negotiated will extend well into 2002,” said TSA executive director Albert A. Pierce.
“That leaves plenty of time for the U.S. economy to stabilize and to strengthen further over the life of these shipper-carrier agreements,” Pierce said.
The carriers of the TSA agreement are APL, CMA CGM, COSCO Container Lines, Evergreen Marine Corp., Hanjin Shipping, Hapag-Lloyd Container Line, Hyundai Merchant Marine, “K” Line, Maersk Sealand, Mitsui O.S.K. Lines, P&O Nedlloyd, Nippon Yusen Kaisha, Orient Overseas Container Line, and Yangming Marine Transport Corp.