The Transpacific Stabilization Agreement (TSA) said the GRI for all cargoes and destinations was being brought forward to 15 April from 1 May in an effort to mitigate the fall in rates seen in February and early March.
Lines are attempting to bring back up spot rates ahead of the annual contracting season, as these are used by shippers as a benchmark in the 12-month rate negotiations with lines. “Competitive pressures to match the lowest short-term rate levels and lock them into 12-month service contracts across the board amounts to a significant deferred investment in the trade,” said Brain Conrad, TSA administrator
TSA said that the fall in rates did not accurately represent the conditions on the transpacific trade.
“The downward rate pressures we are seeing do not reflect the steadily improving cargo picture eastbound from Asia,” Conrad explained. “The Lunar New Year period was strong, with average vessel utilisation numbers in the 95% range; while most people tend to focus only on the supply/demand imbalance, what is getting lost in the pricing discussion is service value.”
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