A consortium of major shipping companies will likely impose a rate increase on all routes between Asia and the West Coast of the US, to provide more sustained economic stability to the industry, and support further investment in transpacific services.
In a press release the Transpacific Shipping Agreement (TSA), a research and discussion forum of major ocean container shipping lines, announced a suggested rates increase of US$400 per 40ft container (FEU) for all cargo moving into the West Coast of the US, and a US$600 per FEU increase on all other cargo. It also recommended a peak-season surcharge of US$400 per FEU, effective from 15 June 2011 to 30 November 2011.
The announcement comes as the industry is experiencing an upturn with growth in shipping between Asia and the US predicted to settle near 12 per cent by the end of the year. According to industry analysts AXS Alphaliner, transpacific capacity grew by 18.6 per cent in the year since November 2009. The press release also stated that in the first three quarters of this year 15 new and restored services commenced sailing.
Chairman of the TSA and chief executive officer of Hanjin Shipping Y M Kim said the industry is now returning to normality after struggling through the financial crisis in 2008-09.
He cautioned, however, that added revenue was needed to support the service levels customers have come to expect.
“Maintaining a stable infrastructure for the movement of goods is no less important today than in past years, and that will take sustained levels of carrier investment over time,” he said.
“Two strong quarters in the transpacific – a highly competitive freight market with very thin margins – still do not fully offset the two years of heavy losses.'
Agreement executive administrator Brian M Conrad pointed out operating costs, such as labour, container handling, inland transport, and the purchase and leasing of container equipment, have continued to rise.
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