Container shipping lines in the Westbound Transpacific Stabilization Agreement (WTSA) have announced a recommended general rate increase (GRI) that will apply to all dry commodities and to all origins and destinations, effective Oct. 1, 2012. The guideline GRI will be $200 per 40-foot container (FEU) and $160 per 20-foot container (TEU).
In announcing the plan to raise the rates, WTSA says westbound revenue (from North America to Asia) has declined considerably from levels seen earlier in 2012, as demand in Asia has slowed and carriers have made concessions in their pricing to accommodate customers. The WTSA reports first quarter 2012 cargo volume of 800,000 FEUs vs. 774,200 FEU for the same period in 2011, a 3.5 percent increase year on year. But more recently, carrier bookings indicate volume gains have narrowed over the summer and freight rates have followed, says WTSA.
“The problem is that moving rates for many commodities have slipped to levels that no longer reflect the value of the service or make an adequate contribution to the round-trip voyage,” says WTSA executive administrator Brian Conrad. “Carriers anticipate an upturn in the typically busy months ahead and feel a need to make up lost ground in terms of revenue.”
WTSA describes itself as a research and discussion forum of major container shipping lines serving the trade from Asia to ports and inland points in the U.S. More information on WTSA can be found at www.wtsacarriers.org.