WTSA to raise bunker rates in October
Container shipping lines in the Westbound Transpacific Stabilization Agreement said Monday they will raise bunker surcharges, beginning Oct. 1, in line with a bunker fuel calculation policy adopted in late 2008.
The increases are $132 per FEU for cargo moving via the U.S. West Coast and $258 per FEU via the East and Gulf coasts for dry cargo. For reefer cargo, the increase is $186 per FEU via the West Coast and $342 for the East and Gulf coasts.
'The increases reflect higher average bunker fuel prices during the 13-week calculation period of June through August,' the discussion agreement said.
WTSA's bunker charge calculation formula tracks average bunker fuel loading prices at Hong Kong and Los Angeles for the West Coast, and Hong Kong and New York for the East and Gulf Coasts. It then translates fuel price fluctuations into per container fuel-related costs for a typical transpacific West Coast or East/Gulf Coast sailing.
'WTSA lines have come under pressure to mitigate their bunker charge adjustments after general rate increases taken in early September,' said Brian M. Conrad, WTSA executive administrator. 'The lines recognize this is an especially challenging market environment and that certain westbound commodities are highly price-sensitive. But it's important to keep in mind that the bunker charge addresses specific costs in carriers' operations that must be recovered. It is distinct from rates, follows a set formula and is not intended to be either increased or mitigated to offset movement in freight rates.'
Conrad said that during the 13-week June-August calculation period, transpacific bunker fuel prices to the U.S. West Coast increased from $386 to $446 per metric ton. Bunker prices to the East and Gulf coasts rose during that same period from $387 to $452.50. Year-to-date, average transpacific bunker fuel prices at the beginning of 2009 were $274 to the West Coast and $237.50 to the East and Gulf coasts, indicating a steep overall rise in carrier fuel costs during 2009, the WTSA said.
WTSA members are APL, COSCO Container Lines, Evergreen Line, Hanjin Shipping, Hapag-Lloyd, Hyundai Merchant Marine, 'K' Line, NYK Line, OOCL and Yang Ming.