Member container shipping lines in the Transpacific Stabilization Agreement (TSA), seeing sustained third-quarter cargo demand across major commodity segments, are recommending a general rate increase (GRI) from all Asia origins to all U.S. destinations, of at least US$600 per 40-foot container (FEU). The increase is to take effect August 1, 2014.
The intended GRI is part of an ongoing revenue improvement program aimed at enabling carrier reinvestment in the transpacific trade lane to ensure adequate service levels as demand increases. Increases were filed by individual lines in June, and plans to implement an August 1 GRI were announced on July 7, with the amount still to be determined.
“Cost-cutting has been at the heart of carrier strategies in recent years, but lines also recognize the potential implications over time in areas such as schedule reliability and equipment availability,” said TSA executive administrator Brian Conrad. “It is essential for the trade to have a rate structure that encourages reinvestment, attracts equipment back into the market, covers rising inland transport and cargo handling costs, and enables carriers to broaden their service offerings. Given current rate levels, TSA members believe that $600 per FEU is the minimum needed to meet those objectives.”