Subscribe to our free, weekly email newsletter!



Transpacific ocean carriers remain optimistic

By Patrick Burnson, Executive Editor
July 14, 2014

While many shippers are concerned about the progress (or lack thereof) in West Coast labor relationships, ocean carriers serving the trade have expressed optimism by announcing a proposed rate hike.

Encouraged by the initial success of a July 1 revenue improvement effort, and by recent public reassurances that cargo will continue moving as U.S. West Coast longshore labor negotiations extend past the contract deadline, container lines in the Transpacific Stabilization Agreement (TSA) are moving ahead with a second phase of the revenue recovery plan.

On July 15, TSA lines will implement a previously announced second-stage $200 per 40-foot container (FEU) general rate increase (GRI) and peak season surcharge (PSS) for cargo moving to Pacific Southwest ports in California. The increase follows a similar increase taken on July 1. While the revenue increase to the West Coast was split into two stages, TSA carriers applied a full $400 per FEU on July for cargo moving to the Pacific Northwest, U.S. East and Gulf Coasts, and via intermodal to inland U.S. points.

In addition, given current unsustainable freight levels overall and the likelihood of continued strong demand through August, TSA is recommending a further August 1 GRI, with the guideline amount to be determined and announced in mid-July.

“With the overall uncertainty already seen in the eastbound freight market, the central issue for shippers and carriers alike is maintaining service and schedule reliability,” said TSA executive administrator Brian Conrad. “All partners in the supply chain need to be able to respond quickly and cover contingencies in the event of cargo surges or bottlenecks. And they need to know that their costs are covered in the process.”

Conrad said TSA members are pleased to hear that both sides in the West Coast longshore labor negotiations are committed to avoiding cargo disruptions now that the July 1 contract renewal deadline has passed and talks are continuing. “We respect the need for confidentiality in the negotiations, but it makes the kind of reassurances we have received all the more important to maintaining confidence in the market,” he said.

About the Author

image
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).


Subscribe to Logistics Management magazine

Subscribe today. It's FREE!
Get timely insider information that you can use to better manage your
entire logistics operation.
Start your FREE subscription today!

Recent Entries

In this webcast we'll explore how successful companies use strategies such as cross-client load consolidation, zone skipping, pooling, etc. to minimize freight cost. You’ll hear how transportation optimization is used to generate cost savings and where the ROI comes from.

Even with expected import cargo volume declines in the coming months, the Port Tracker report by the National Retail Federation (NRF) and maritime consultancy Hackett Associates expects volumes to be up for the first half of 2016.

USPS pointed to ongoing growth in its Shipping and Package Group, whose primary offerings are comprised of Priority Mail, Express Mail, Parcel Select and Parcel Return services, as the key driver for the quarterly revenue gains.

With a 2.3 cent decline to $2.008 per gallon, this week’s price stands as the lowest national average going back to the week of March 16, 2009, when it checked in at $2.017.

A recent Wall Street Journal report stated that third-party logistics and freight transportation services provider XPO Logistics shut down seven freight terminals that were part of the Con-way Inc. less-than-truckload (LTL) network, Con-way Freight. Con-way was acquired by XPO for $3 billion last year.

Article Topics

Blogs · Ocean Freight · Supply Chain · Container · All topics

Comments

Post a comment
Commenting is not available in this channel entry.


© Copyright 2016 Peerless Media LLC, a division of EH Publishing, Inc • 111 Speen Street, Ste 200, Framingham, MA 01701 USA