Ship Line Calls for Scrap Metal Rate Hike

Transpacific shipping lines in the Westbound Transpacific Stabilization Agreement are recommending increases to metal scrap freight rates for this year.

Effective February 15, WTSA member lines say they will raise metal scrap rates by $100 per 40-foot container and $80 per 20-foot container on port-to-port cargo and West Coast/East Coast local door moves to Asia, and by $150 per FEU and $120 per TEU for inland point or minilandbridge intermodal cargo.

Despite continued strong industrial demand for recycled scrap in Asia, rates remain low to the point that some carriers in the trade have stopped soliciting scrap shipments to certain destinations – most notably in China – because current rates do not adequately cover transport, equipment and cargo handling costs. This is particularly true for intermodal U.S. cargo, with westbound carriers anticipating rail rate increases of as much as 20 percent in 2007.

WTSA consists of 11 container shipping lines that service the Asian market. Members of the group include: American President Lines, Ltd., Hyundai Merchant Marine Co.,

China Shipping Group, Kawasaki Kisen Kaisha, Ltd., COSCO Container Lines, Ltd., Nippon Yusen Kaisha, Evergreen Marine Corp., Orient Overseas Container Line, Inc.,

Hanjin Shipping Co., Ltd., Yangming Marine Transport Corp., and Hapag Lloyd Container Lines.