Ocean Freight Rates to Rise Soon
Steamship lines are planning to raise shipping rates by at least 10 percent to 20 percent on May 1.
The Transportation Stabilization Agreement (TSA), a cartel made up of 13 shipping lines, agreed to raise rates by $285 per 40-foot container (FEU) for cargo moving from Asia to the West Coast. Currently, the average cost to ship a 40-foot container is approximately $2,500. Rates vary depending on the cargo container’s origin and the contract negotiated by the company.
Inter-modal rates for containers unloaded on the West Coast and then transported inland by truck or rail will increase $350 for a 40-foot container and $430 for all-water transported cargo going through the Suez or Panama canals and ending up on the East Coast.
In addition, a $400 peak-season surcharge will be in effect from June 15 to Nov. 30.
“These are figures that the TSA puts out there, and then, depending on who the customer is, big or small, the companies will try to negotiate those terms down,” said Peter Gruettner, owner of Extra Logistics LLC, an ocean and air freight forwarder based in Lakewood, Calif.
Shipping line executives maintain the hikes are needed because their companies’ costs are expected to increase by 11 percent to 12 percent this year due to port congestion, higher truck and rail expenses, and capacity restraints in the United States and Asia.
TSA members include American President Lines, COSCO Container Lines, Evergreen Marine Corp., Orient Overseas Container Line, Hanjin Shipping Co., P&O Nedlloyd Ltd. and Hyundai Merchant Marine Co.
—Deborah Belgum
