Koch: Supportive shippers drowned out on TSA plan

Koch: Supportive shippers drowned out on TSA plan

Koch

   The head of the World Shipping Council last week said there were shippers who supported a plan by transpacific ocean carriers to collectively discuss capacity on the trade to improve efficiency amid falling demand.
   The voices of supportive shippers were swallowed by shipping advocacy groups opposed to the plan, said Chris Koch, council president and chief executive officer, in a speech at Feb. 26 to the maritime trades department of the AFL-CIO.
   Transpacific Stabilization Agreement members in mid-February withdrew their request to the Federal Maritime Commission to collectively discuss capacity.
   'Efforts within the liner shipping industry to see if a group of lines could develop a collective approach to current overcapacity through coordinated capacity discussions in the transpacific trade were recently shot down at the Federal Maritime Commission by shipper organizations' objections,' Koch said. 'We will never know whether such an effort would have produced a better outcome than what the shipping public will face with uncoordinated service reductions and capacity decision-making.'
   Koch said it could be a missed opportunity for carriers and shippers.
   'The irony is that the voices of many actual shippers, who wrote to the FMC in support of giving the carriers involved a chance to develop such an approach for agency review, were simply drowned out, and the carriers involved were simply not willing to be a political punching bag,' he said. 'Not being given the chance, we won't know what the lines could have produced.'
   Koch said a recovery is too far off to envision.
   'When the industry will see significant improvement is unclear,' he said. 'What is clear is that reduced consumer demand worldwide, coupled with excess supply of new vessel tonnage, are creating a very difficult business environment. We can expect members of the industry to announce more changes affecting their services and operations, and we can expect that the trade and financial numbers from the first quarter of this year will be very sobering.' ' Eric Johnson