From: David Hickmott
[DHickmott@uli-atl.com]
Sent: Monday, August 10, 2009 8:16
AM
To: David Hickmott
Cc: David Hickmott; David Hickmott
Subject: Transpacific GRI/PSS
Announcement: Effective August 10, 2009
Dear Valued Unique Customer,
Further the earlier July
announcement regarding TSA increase, it appears that most of the TSA and
non-TSA carriers are pushing forward with implementation of the full GRI and
many carriers have also filed with FMC for PSS starting in September through October.
Over the past several months and planning for the future, many of the ocean
carriers have addressed cost cutting measures such as cancelling service
strings, consolidating services, and shifting capacity. However, the
world market for most trades has been negative with most carriers reporting
quarterly losses exceeding $200 million. In recent weeks, there has been
an upturn in the Trans-Pacific market with space from some ports being limited,
bookings being rolled and/or refused for later sailings. In the current
market, the carriers believe that they are in the best position to implement
the full GRI.
ULI Group has been monitoring
this situation carefully since the announcement by TSA. With our
core ocean carriers, ULI has been negotiating to mitigate the impact of
the GRI for our long-term loyal customers which has been providing support to
the carriers. For various origin ports and destination points, we have
achieved levels that are below the TSA announced GRI ranging from $300-500 per
40’. Since the GRI will take effect on any cargo tendered at origin CY
on/after August 10th, our sales/pricing team will be updating all
rates during the next 2 weeks. For any current shipments, we will update
the rate for the given port pair and send prior to shipping. While this
approach may take a little longer to update all port pairs, ULI believes that
it will be a better approach to minimize the full impact to our
customers. The alternative to this approach would be to simply implement
the full TSA GRI. However, we don’t believe that this would be in best interest
of our customers if ULI can find a way to mitigate when and where possible.
We appreciate your support and
patience during this time while ULI works on your behalf to update the rates.
Thank you for
your support of Unique Logistics International. We appreciate and value
your business.
Discover the
"Unique" difference of logistics from Asia to USA trade!
Best Regards
David Hickmott - Executive Vice President
ph#404-767-0500 (ext 306)
Mobile# 678-478-6604
Fax# 404-767-3319
TSA lines plan
$500-per-FEU rate hike
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Container shipping lines serving the Asia/U.S. freight market say they will
seek an across-the-board freight rate increase of $500 per 40-foot equivalent
unit next month.
The 14 members of the Transpacific Stabilization Agreement (TSA)
said they have adopted a voluntary guideline increase because "average
rate levels achieved in the latest round of service contract negotiations are
not sustainable over the typical 12-month 2009-2010 contract term."
The $500 per FEU increase, with proportionate increases for other
equipment sizes, is to take effect Aug. 10. The increase will apply to rates
for all commodities and all U.S destinations.
TSA said that in certain cases, it will be necessary for lines to
engage with shippers in a renegotiation of contracts that do not provide for
some form of interim rate adjustment.
The carriers said they will also pursue full implementation of the
quarterly bunker fuel charge, which adjusted upward on July 1 to reflect higher
fuel prices.
TSA added that the planned general rate increase does not preclude
the possibility of a peak season surcharge if the market measurably strengthens
and extensive peak season costs are incurred.
2009-2010 contracts "were negotiated in the midst of a
severely depressed global economy, in which first quarter 2009 cargo demand
from Asia to the U.S. was more than 20 percent below levels of a year
earlier," the discussion agreement said. "Conditions during the
second quarter have shown only slight improvement.
"Competitive pressures to keep services operating and avoid
further costly vessel layups eroded even the minimum rate levels carriers tried
to put in place in the trade in April. TSA reports a $1,000-1,200 drop in
average revenue per container during the period from October 2008 through May
2009 alone."
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Yen |
“The eastbound transpacific trade lane has been driven by panic, and panic is
difficult to stop once it has begun,” said W.W. Lee, chief executive for
container liner business at Hanjin Shipping, Ltd. “With 2009-2010 contracting
nearly completed, lines have had a chance to assess the damage. From an
industry-wide point of view the damage is serious, and if current rates are
extended out over 12 months, it is likely that the trade will encounter
significant financial challenges as well as basic service sustainability issues
going forward.”
TSA said, "Container lines should not have given in to
pressure to match short-term, concessionary rates in the market at the time
contracts were being negotiated."
“Market forces will ultimately dictate how the current situation
resolves itself,” said Jack Yen, Evergreen Marine Corp. president. “In the end
this is about the cost of maintaining a viable transportation and logistics
service in a challenging market, and investing for the eventual turnaround.
Transpacific carriers did not make a strong enough case in their negotiations
for stabilizing revenue in the coming year. But the fundamental problems
remain, as can be seen in carrier quarterly earnings reports and continued
carrier and service consolidation.”
TSA members are APL, China Shipping, CMA CGM, COSCO Container
Line, Evergreen, Hanjin, Hapag-Lloyd, Hyundai Merchant Marine Co.,
"K" Line, Mediterranean Shipping Co., NYK Line, Orient Overseas
Container Line, Yang Ming and Zim.
A copy of the TSA press release is available
at the following URL:
http://www.tsacarriers.org/pr_070709.html