TSA to calculate bunker fee quarterly

TSA to calculate bunker fee quarterly    Member liner carriers in the Transpacific Stabilization Agreement said Tuesday they have overhauled their bunker surcharge formula to 'make the process more transparent and stabilize the cost impacts to customers.'
   The new bunker surcharge formula will become effective with 2009-10 service contracts starting May 1 or later.
   Of note, the new formula distinguishes between U.S. West Coast and East Coast sailings; and accounts for changes to vessel size, speed and fuel consumption in recent years. Most significantly, the carriers will begin calculating the surcharge quarterly rather than monthly.
   'Vessel and operating characteristics have changed in the seven years since TSA last modified its bunker formula,' TSA chairman Ron Widdows said in a statement. 'In the current environment of price volatility, members saw an opportunity to improve the accuracy of their fuel cost calculations, while also accommodating shippers' calls for greater transparency in how the charge is developed.'

Widdows

   TSA said it began working on the new formula in the late summer of 2008, as bunker fuel prices had hit a peak level of $767 per metric ton — a 260 percent increase since the beginning of 2007. The new formula will be based on average weekly fuel prices published by independent tracking service Bunkerworld, for a smaller number of load ports — Hong Kong and Los Angeles for a West Coast sailing; and Hong Kong and New York for an East Coast sailing.
   It assumes average vessel size, fuel consumption and steaming time for each routing, taking into account effective capacity for each type of vessel.
   'It enables carriers to fully and fairly recover costs, and provides shippers with greater pricing predictability in planning their shipments,' Widdows said.
   TSA will post the new formula shortly in the ancillary charges section of its web site, www.tsacarriers.org. The calculation page will track Bunkerworld average West Coast and East Coast weekly fuel prices over a 13-week period and will provide a link to a fact sheet explaining the calculation formula in detail, with a table for translation of the 13-week average price into the upcoming quarterly bunker charge. It will also link to a page on the Bunkerworld Web site confirming average weekly West Coast and East Coast prices, developed specifically for TSA.
   For an initial transition period through June 30, TSA will separately retain the weekly fuel price listings and calculation table for the existing formula on its web site, for the benefit of current 2008-2009 service contracts.
   TSA members are APL, China Shipping, CMA CGM, COSCO, Evergreen Line, Hanjin Shipping, Hapag-Lloyd, Hyundai Merchant Marine, 'K' Line, MSC, NYK Line, Yang Ming and Zim.