Liner companies raise rates for scarce eastbound capacity out of China
Source
American Shipper
Post Date
02/03/2010
The spike in prices over the last few weeks was fueled by the “emergency rate charge” that was implemented on Jan. 15 by the 15 carrier members of the Transpacific Stabilization Agreement. But the carriers have been able to increase spot rates by almost double the TSA’s guideline as shippers scramble to find scarce vessel space in advance of the one-week closure of Chinese factories for the Chinese New Year, which begins on Feb. 14. Importers report that space has been so scarce in the past few weeks that their eastbound containers have been “rolled,” or not loaded aboard the ships on which they had booked space. One carrier told a shipper that so many containers had piled up in Shanghai recently that failed to make it onto a vessel bound for the U.S. that it could have filled another entire vessel. In January the TSA called for a mid-contract emergency rate increase as of Jan. 15 of $400 per FEU shipped from Asia to U.S. ports to tide its carrier members over until they can seek an $800 per FEU increase on containers shipped to U.S. ports in their 2010-2011 contracts. In an effort to reduce the glut of capacity that caused freight rates to plummet through much of last year, carriers have laid up about 10 percent of the container fleet, put other ships to work by slow-steaming many services and eliminated other services by establishing vessel-sharing agreements with competitors.
