Member liner carriers in the Transpacific Stabilization Agreement said they have overhauled their bunker surcharge formula to “make the process more transparent and stabilize the cost impacts to customers.”
The new bunker surcharge formula will become effective with 2009-10 service contracts starting May 1 or later.
Of note, the new formula distinguishes between U.S. West Coast and East Coast sailings; and accounts for changes to vessel size, speed and fuel consumption in recent years. Most significantly, the carriers will begin calculating the surcharge quarterly rather than monthly.
“Vessel and operating characteristics have changed in the seven years since TSA last modified its bunker formula,” TSA chairman Ron Widdows said in a statement. “In the current environment of price volatility, members saw an opportunity to improve the accuracy of their fuel cost calculations, while also accommodating shippers’ calls for greater transparency in how the charge is developed.”
TSA said it began working on the new formula in the late summer of 2008, as bunker fuel prices had hit a peak level of $767 per metric ton -- a 260 percent increase since the beginning of 2007. The new formula will be based on average weekly fuel prices published by independent tracking service Bunkerworld, for a smaller number of load ports -- Hong Kong and Los Angeles for a West Coast sailing; and Hong Kong and New York for an East Coast sailing.
It assumes average vessel size, fuel consumption and steaming time for each routing, taking into account effective capacity for each type of vessel.
“It enables carriers to fully and fairly recover costs, and provides shippers with greater pricing predictability in planning their shipments,” Widdows said.
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