• ITVI.USA
    13,670.690
    -217.880
    -1.6%
  • OTRI.USA
    22.060
    -0.040
    -0.2%
  • OTVI.USA
    13,638.790
    -223.800
    -1.6%
  • TLT.USA
    2.800
    0.000
    0%
  • TSTOPVRPM.ATLPHL
    2.480
    -0.170
    -6.4%
  • TSTOPVRPM.CHIATL
    3.070
    -0.210
    -6.4%
  • TSTOPVRPM.DALLAX
    1.370
    -0.090
    -6.2%
  • TSTOPVRPM.LAXDAL
    2.280
    -0.210
    -8.4%
  • TSTOPVRPM.PHLCHI
    1.900
    -0.070
    -3.6%
  • TSTOPVRPM.LAXSEA
    2.720
    -0.270
    -9%
  • WAIT.USA
    127.000
    0.000
    0%
  • ITVI.USA
    13,670.690
    -217.880
    -1.6%
  • OTRI.USA
    22.060
    -0.040
    -0.2%
  • OTVI.USA
    13,638.790
    -223.800
    -1.6%
  • TLT.USA
    2.800
    0.000
    0%
  • TSTOPVRPM.ATLPHL
    2.480
    -0.170
    -6.4%
  • TSTOPVRPM.CHIATL
    3.070
    -0.210
    -6.4%
  • TSTOPVRPM.DALLAX
    1.370
    -0.090
    -6.2%
  • TSTOPVRPM.LAXDAL
    2.280
    -0.210
    -8.4%
  • TSTOPVRPM.PHLCHI
    1.900
    -0.070
    -3.6%
  • TSTOPVRPM.LAXSEA
    2.720
    -0.270
    -9%
  • WAIT.USA
    127.000
    0.000
    0%
American Shipper

TSA unveils transpacific rate index

TSA unveils transpacific rate index

   June transpacific rates reached a 14-month nadir, according to a new monthly revenue index being published by the Transpacific Stabilization Agreement.

   The index tracks average revenue per FEU levels against a June 2008 baseline. In June, the index was 84.28 for Asia/U.S. West Coast trade (the baseline is 100), lower than any month since April 2010. For context, the index was 84.53 in June 2010, but then spiked to 114.57 in August. Since then, it has been on a steady decline, remaining under 100 since November.

   For all-water services, there’s been less fluctuation but lower overall rates. June rates reached a low (79.21) not seen since March 2010.

   'TSA has maintained a revenue index internally for several years, as part of its mandate to track market trends and set pricing stabilization goals,' the agreement said. 'As TSA has added new carrier members since 2007, it began a review of the index to reflect the changing characteristics of the group, as well as changing trends in the trade. Recently, an increasing number of customers have expressed interest in longer-term service contracts that begin with a specified set of rates and charges, and then have built-in escalator provisions or are otherwise allowed to fluctuate within a band over the life of the contract without further need for negotiation.

   'To make such contract provisions work, it would be necessary to have some historic baseline or reference point for understanding revenue trends and setting triggers for price movements or renegotiation,' TSA said.

   The index provides information on base rates plus non-fuel ancillary charges, spot and contract rates, beneficial cargo owners and third-party shipments for TSA member lines across the entire TSA trade. The index began tracking revenue with January 2010 levels.

   TSA said it has released the index in part to overcome the limitations of third-party rate indexes that have recently emerged.

   'Some are based on specific rates provided by a sampling of carriers that do not necessarily reflect the entire eastbound transpacific market,' TSA said. 'Others are based on 'spot' rates between select, high-volume port pairs which fail to include any ancillary charges and are not necessarily reflective of negotiated longer-term contract rates under which the vast majority of cargo in the trade moves.

   'The TSA Revenue Index tracks average revenue per 40-foot container across the entire geographic scope of the eastbound transpacific trade. The index includes tariffs and service contracts representing more than 85 percent of eastbound cargo volume.'

   Twelve of the 15 TSA carriers submit monthly to the TSA office their average revenue per FEU for the total TSA trade scope — with separate totals to the U.S. West Coast and to the U.S. East Coast-Gulf. Certain lines have internal policies or systems that preclude them from regularly providing the data to the organization.

   Each carrier provides average revenue in U.S. dollar terms, with individual carrier data kept confidential by TSA, and aggregated to develop the index. A weighting is applied to each carrier’s submission based on relative cargo volume for that month, with the weighting updated each month.

   TSA provided an example: 'Carrier A, with an average revenue per FEU of $2,000 to the West Coast, and a market share of 10 percent, is assigned a relative revenue of $200 toward construction of the total average rate; Carrier B, with an average revenue of $2,500 and a 5 percent market share, is assigned a relative value of $125 toward the aggregate average.'

   The TSA said June 2008 has been established as the baseline because 'it represents the most recent pre-recession revenue levels so as not to skew current data.

   'The intent behind the index is to show how revenue per FEU has evolved over the past 18 months, and how each month going forward compares to prior months, rather than comparing present revenue levels to those of 3 years ago,' the TSA said.

   The most recent results, as well as methodology for data collection underlying the index can be found here.

   TSA members are APL, China Shipping, CMA CGM, COSCO Container Lines, Evergreen Line, Hanjin Shipping, Hapag-Lloyd, Hyundai Merchant Marine, 'K' Line, NYK Line, Maersk Line, Mediterranean Shipping Co., OOCL, Yang Ming and Zim. ' Eric Johnson