U.S.-Asia Shipping Lines Recommend Dry Cargo Rate Hike
Container shipping lines in the Westbound Transpacific Stabilization Agreement (WTSA) have announced a recommended general rate increase, effective Oct. 1.
Sept. 4, 2012 (Press Release) - Container shipping lines in the Westbound Transpacific Stabilization Agreement (WTSA) have announced a recommended general rate increase (GRI) that will apply to all dry commodities and to all origins and destinations, effective October 1, 2012.
The guideline GRI will be in the amount of US$200 per 40-foot container (FEU) and $160 per 20-foot container (TEU).
WTSA explained that westbound revenues have declined considerably from levels seen earlier in the year, as demand in Asia has slowed and carriers have made concessions in their pricing to accommodate customers during the difficult period. The Agreement reported first quarter 2012 cargo volume of 800,000 FEUs vs. 774,200 FEU for the same period in 2011, a 3.5% increase year on year. More recently, carrier bookings indicate that those volume gains have since narrowed over the summer, and freight rates have followed.
“The problem is that moving rates for many commodities have slipped to levels that no longer reflect the value of the service or make an adequate contribution to the round trip voyage,” said WTSA executive administrator Brian M. Conrad. “Carriers anticipate an upturn in the typically busy months ahead and feel a need to make up lost ground in terms of revenue.”
WTSA is a research and discussion forum of major container shipping lines serving the trade from Asia to ports and inland points in the U.S. More information on TSA can be found at: www.wtsacarriers.org