Carriers in the eastbound Pacific predicted the volume of containerized imports from Asia will likely increase 6 to 8 percent this year. However, as the lines enter service contract negotiations with their customers, they noted that market conditions in the largest U.S. trade lane remain uncertain.
The Transpacific Stabilization Agreement, a discussion group of 15 carriers in the eastbound Pacific, met last week in Taipei and projected that cargo volumes will remain strong into April.
Carriers are entering into negotiations with retailers and other importers for annual service contracts that will take effect on May 1. Those contracts will include freight rates and terms of service to be provided by carriers.
Last fall, the TSA indicated that in order to work back toward profitability in 2010, carriers needed rate increases of $800 per 40-foot container for cargo moving to the West Coast, and $1,000 per-FEU for intermodal shipments and all-water cargoes moving to the East Coast.
Even if they achieve those increases in the current round of contract negotiations, which would bring some freight rates back to 2008 levels, rates would be "barely compensatory," the TSA said.
Drewry Shipping Consultants estimated that carriers last year lost in aggregate $15 billion to $20 billion in their global operations, and would incur an additional $7 billion in losses in the first quarter of 2010.
The Journal of Commerce Online
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