WTSA lines will charge wastepaper exporters fuel surcharge

WTSA lines will charge wastepaper exporters fuel surcharge Now it’s westbound transpacific shippers' turn.
   Container line members of the Westbound Transpacific Stabilization Agreement said they plan to begin recovering a greater share of fuel costs in their contracts with wastepaper shippers, which accounted for 18.3 percent of all westbound cargo in the first half of 2007.
   Effective Jan. 1, WTSA lines say they intend to assess bunker fuel surcharges separately from base freight rates for wastepaper, and allow those surcharges to float, adjusted on a regular basis to reflect fluctuations in world bunker fuel prices.
   The announcement follows a recommendation on Nov. 15 by the eastbound discussion agreement, the Transpacific Stabilization Agreement (TSA), that recommended its 14 carrier members start including a “full floating bunker surcharge” in all new service contracts when they renew. All 10 members of the WTSA also are members of the TSA.
   “Wastepaper contracts have typically included provisions mitigating the bunker surcharge and folding it into an all-inclusive rate, owing partly to the low shipment value and unique price structure of U.S. wastepaper shipments to Asia,” the WTSA said.
   “WTSA lines are taking a first step with respect to the leading commodity in the trade in terms of volume,” said Brian M. Conrad, WTSA executive administrator. “Wastepaper rates are low from the outset, and downward pressure on rates over time has eroded fuel cost recovery buried within the rates. At the volumes wastepaper moves, it is nowhere near making an adequate revenue contribution as fuel costs have risen 55 percent since the beginning of 2007 alone.”
   More than 466,000 TEUs of wastepaper moved from the U.S. to Asia in the first half of 2007.
   WTSA stressed that setting bunker surcharges separately from base rates does not mean lines intend to offset the new surcharges with base rate concessions, nor would the new surcharges preclude separate actions on rates during 2007 as market conditions dictate.
   WTSA members are APL, Hyundai, COSCO, 'K' Line, Evergreen, NYK, Hanjin, OOCL, Hapag-Lloyd and Yang Ming.