Thursday, December 18, 2014

TRANSPACIFIC GRI

Transpacific carriers want more rate hikes

TSA members propose a GRI and a peak-season surcharge.

Transpacific container carriers are announcing another general rate increase in mid-January, just days after a recommended $1,000-per-FEU rate hike went into effect.
The Transpacific Stabilization Agreement, a discussion agreement container lines, said that effective Jan. 15, its 15 member lines are recommending a $600-per-FEU general rate increase for all origin and destination points, along with the reinstatement of a $400-per-FEU peak season surcharge in anticipation of a possible pre-Lunar New Year cargo surge.
The announcement comes just days after a Dec. 15 general rate increase of $1,000 per FEU that was recommended by the TSA earlier this month.
Last Friday, Freight Investor Services noted that Shanghai to U.S. West Coast spot container freight rates — as estimated by panelists for the Shanghai Shipping Exchange’s Shanghai Container Freight Index — jumped 24 percent or $434 to reach $2,259 per FEU in advance of the Dec. 15 general rate increase. Rates to Europe were up even more sharply — 88 percent or $634 — to $1,353 per TEU.
Freight Investor Services said all eyes will be on this week’s SCFI to see how much of the increases can be maintained prior to the usually quiet period around Christmas, when it said rate movements tend to be minimal.
TSA executive administrator Brian Conrad said the general rate increase “is part of an ongoing effort by TSA lines to reverse erosion brought about by short-term rates in the Asia-U.S. freight market.”
The peak season surcharge, he added, “reflects sustained cargo demand growth heading into the Lunar New Year period, when many Asian factories close for a week, producing surges in traffic immediately before and after.”