Shippers will not see the current low freight rates on the Asia-US trade being extended past January, the Transpacific Stabilisation Agreement (TSA) has warned.
"No one should expect to see freight rates extended at current levels in upcoming 2009-10 contracts," said TSA executive administrator Brian Conrad, speaking after the member lines met in Hong Kong this week.
"To maintain current rates over an 18-month time frame would threaten the financial viability of any major carrier in the market today.
Shipping lines in the TSA voiced concern over recent rate instability and competitive actions that have taken some Asia-US freight rates to non-remunerative levels.
The TSA acknowledged that member carriers as well as non-TSA lines have participated in the rate actions in selected commodity and customer segments during the past month.
"The rate actions seen in recent weeks are shortsighted and regrettable," said Conrad.
"They haven't produced new business, they haven't increased anyone's market share and they do not adequately reflect operating costs."
CargoNewsAsia
Login
