TACA CARRIERS SEEK HIGHER RATES
The shipping lines of the Trans-Atlantic Conference Agreement have announced a plan to claw back, through rate increases, some of the revenue they have lost because of falling freight rates.
Conference carriers Atlantic Container Line, Hapag-Lloyd, Mediterranean Shipping Co., Maersk Sealand, NYK, OOCL and P&O Nedlloyd said through a joint announcement by TACA that tariff rates will be increased by:
* $240 per 20-foot container, $300 per 40-foot container, or $15 per freight ton for westbound shipments, effective June 1.
* And additional $120 per 20-foot container, $150 per 40-foot container, or $8 per freight ton in the eastbound direction, effective March 15.
Rates have decreased by as much as 50 percent since early 2001, the conference said.
“There’s been extreme pressure on the rates,” said David Jeffries, secretary of the TACA conference. Current rates “are not sustainable.”
Traffic flows have dropped by about 5 percent this year, compared to 2001, while capacity has increased marginally. However, the carrier group said these factors “do not explain the significant general downward pressure on rates that has been experienced for some time.”
Although the announced increases in TACA tariff rate do not apply to individual service contracts, which are agreed without the involvement of the conference, such announced increases are still a factor in rate negotiations when service contracts come up for renewal.
The conference said the general level of rates “will still not reach the levels of early 2001,” even after the proposed increases have been implemented.
The transatlantic carriers' program to return rates to earlier levels follows similar programs announced by the Transpacific Stabilization Agreement in January and by the Asia/Europe conference in November 2001.
Transatlantic carriers have announced no program to reduce capacity in the North America/Europe trade so far.