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Ocean cargo carriers confident Transpacific rate hikes will stick

Each carrier plans their individual vessel and equipment allocations to meet back-to-school and holiday retail cargo demand.
By Patrick Burnson, Executive Editor
July 02, 2013

Ocean cargo carriers comprising the Transpacific Stabilization Agreement (TSA) have announced a guideline peak season surcharge (PSS) of $400 per 40-foot container from Asia to all U.S. destinations, effective August 1.

According to TSA spokesmen, each carrier plans their individual vessel and equipment allocations to meet back-to-school and holiday retail cargo demand.

“Positive signals on consumer confidence for second-half 2013, and healthy consumer spending data in the second quarter, suggest a likely bump for Asian imports in coming months, and container shipping lines in the TSA are preparing for a potentially healthy peak season,” said the spokesman.

As forecasted in LM, shippers have been bracing for the rate hikes for several months now.

“It is hard to say at this point what the size and the timing of the peak will be, but lines are expecting a defined peak period and want to be prepared,” said TSA executive administrator Brian Conrad. “That means having the necessary vessel and equipment assets in place, the right mix of services, and their costs adequately covered to quickly address contingencies.”

Peter Sand, chief shipping analyst for The Baltic and International Maritime Council in Copenhagen (BIMCO), said that the traditional peak season has undergone severe change since the last great recession, however.

“The U.S. consumer market is determining different peaks now,” he said. “Back-to-School, Black Friday, and Christmas holiday are still valid, but there is now less pressure on a season that was once unique.”

TSA lines reported gains from the most recent round of Asia-U.S. freight increases taken on July 1, but said results still fall short of overall revenue objectives for 2013-14 service contracts, so they will be weighing the need for further initiatives later this summer. 

About the Author

Patrick Burnson
Executive Editor

Patrick Burnson is executive editor for Logistics Management and Supply Chain Management Review magazines and web sites. Patrick is a widely-published writer and editor who has spent most of his career covering international trade, global logistics, and supply chain management. He lives and works in San Francisco, providing readers with a Pacific Rim perspective on industry trends and forecasts. You can reach him directly at .(JavaScript must be enabled to view this email address).

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