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 - LM Editorial

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

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

UPS today announced diluted earnings per share of $1.32 for the third quarter 2014, a 13.8% improvement over the prior year period. Operating profit increased 8.3%, resulting from balanced growth across all three segments.

The Department of Transportation’s Bureau of Transportation Statistics (BTS) reported this week that U.S. trade with its North America Free Trade Agreement (NAFTA) partners Canada and Mexico increased 4.4 percent from August 2013 to August 2014 at $100.6 billion.

As expected, global trade dipped from August to September but still saw annual gains, according to data issued this week by Panjiva, an online search engine with detailed information on global suppliers and manufacturers.

Transportation and logistics merger and acquisition (M&A) activity in the third quarter saw annual gains, which were driven by smaller deals in the trucking logistics, shipping, and passenger air sectors, according to data issued in the Intersections report by PwC this week.

With the holidays rapidly approaching, it appears retailers are not quite done getting inventory set up and on the shelves in time for what is expected to be a fairly active shopping season. That much was evident based on recent data for September volumes issued by the Port of Los Angeles (POLA) and the Port of Long Beach (POLB).

About the Author

Patrick Burnson, Executive Editor
Patrick Burnson is executive editor for Logistics Management and Supply Chain Management Review. Patrick covers 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. Contact Patrick Burnson

Comments

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


© Copyright 2013 Peerless Media LLC, a division of EH Publishing, Inc • 111 Speen Street, Ste 200, Framingham, MA 01701 USA