Leading global container carrier AP Moeller-Maersk A/S and 14 other shipping lines intend to raise rates on Asia-US routes beginning on 1 January 2012 to cope with industry-wide losses caused by a price war and overcapacity, according FIS.com.
Among the shipping lines are Neptune Orient's APL Ltd and CMA CGM SA. They all plan to impose a levy of at least US$400 per 40ft container as a temporary measure before annual contract negotiations start, the Transpacific Stabilisation Agreement (TSA) said.
The companies want to take advantage of a surge in bookings ahead of the late January Lunar New Year holidays to get higher rates after fading consumer confidence and relatively sluggish demand ruined the plan of implementing peak-season surcharges, the report said, citing Bloomberg.
Maersk last week said the third-quarter sag caused its container unit to suffer a loss this year in contrast with earlier predictions for a profit. It saw a third-quarter net loss of US$293 million compared with a profit of US$1 billion a year ago.
Freight rates have been skidding because the container shipping industry has added too many ships out of the belief that the global economy would rebound, and this has resulted in overcapacity.
Maersk --which transports about 16% of the world’s manufactured goods by sea routes -- said higher global container demand has not been able to counteract oversupply.
“Everybody was gearing up for the peak season in the third quarter and the peak season didn’t occur,” CEO Nils Smedegaard Andersen said. “We’re destroying the price levels for ourselves.”
However, Maersk will not suffer as much as its peers, he stated.
“Rate levels during 2011 have steadily eroded despite rising inland transport, cargo-handling and other costs,” explained Brian M Conrad, the TSA's executive administrator. “As carriers look toward building a platform for the 2012-13 contract cycle, the feeling is that a correction is both imperative and overdue.”
The planned hike in rates will preclude the reductions offered this year from affecting the next round of annual contracts that are set to commence around May 2012. The TSA intends to publicize guidelines for the next contracts around the end of the year, the group said.
The other members of the group are Kawasaki Kisen Kaisha Ltd, China Shipping Container Lines Co, Mediterranean Shipping Co, China Cosco Holdings Co, Nippon Yusen KK, Evergreen Group, Orient Overseas (International) Ltd, Hanjin Shipping Co, Yang Ming Marine Transport Corp, Hapag-Lloyd AG, Zim Integrated Shipping Services Ltd and Hyundai Merchant Marine Co. Source: FIS.com