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TSA sets out new minimum rate levels

TSA sets out new minimum rate levels
The Transpacific Stablisation Agreement (TSA) have set out a series minimum rate levels as lines struggle to push up levels ahead of annual contract negotiations.

For 1 December the TSA is aiming for $950 per feu to the US West Coast from Asia, and $1,700 per feu to the US East and Gulf Coasts. For 1 January 2016, the TSA has filed for $1,200 per feu to the US West Coast, and a slightly lower rate to the US East and Gulf Coasts of $1,600 per feu.

“Transpacific lines are adjusting to a new normal of larger ships and complex alliances, necessitated by cost and environmental compliance pressures – all in the context of an uncertain global economic environment,” explained TSA executive administrator Brian Conrad. “Irrespective of cyclical supply-demand issues, it is critical that these global infrastructure providers get their pricing right and fully recover their costs through meaningful, staged rate increases heading into 2016.”

For new annual service contracts, mostly from 1 May 2016, TSA is recommending a minimum level of $1,700 per feu to the US West Coast, and $2,900 per feu to the US East and Gulf Coasts.

TSA also flagged up a concern over higher feedering costs in Asia as larger vessels are introduced on mainline routes on the transpacific.