The discussion group representing shipping lines in the eastbound Pacific has recommended a guideline calling for a rate increase of $400 per 40-foot container to take effect on Nov. 15.
The Transpacific Stabilization Agreement suggested that the rate increase would cover imports from all origins in Asia to all destinations in the U.S.
“The trade is seeing modest but healthy growth over 2012, while cargo-handling, equipment and other costs continue to rise, and most carriers are operating at a loss,” TSA Executive Administrator Brian Conrad said.
As a discussion group representing 15 carriers in the eastbound Pacific, the TSA performs market research and recommends rate actions to its members, but it has no enforcement powers.
Carriers this year have battled weak growth in demand that has failed to keep up with growth in capacity. That’s resulted in a series of general rate increases that largely have not stuck in whole or, in some cases, at all.
Spot rates between China and the U.S. West Coast represented in the Shanghai Containerized Freight Index have declined dramatically this year after a brief increase around the Chinese New Year celebrations in February, further indication of the headwinds carriers face in sustaining rate increases.
The Journal of Commerce
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