A major shipping company that carries goods to Hawaii from the U.S. mainland plans to raise its fuel surcharge to a record 47.5 percent next month, Forbes reports.
Citing recent high fuel prices, Matson Navigation Company plans to raise its fuel surcharges by four percentage points, the company said Wednesday. The surcharge is to rise from 45 percent to 49 percent for services in Guam, the Commonwealth of the Northern Mariana Island and Micronesia. Matson previously announced increased surcharges on March 31.
Since then, "fuel prices not only failed to stabilize, but continued to rise," the company said in a letter to customers.
Matson touts itself as providing a lifeline to the islands, which depend on shipments of goods from the mainland. "We bring in virtually everything to support the state's economy," said spokesman Jeff Hull. "From food to automobiles to construction materials."
Under the latest increase to take effect June 12, the additional surcharge for a 40-foot container of rice would be $89, Hull said. A container holds 2,280 20-pound bags. For 24,000 heads of lettuce, the additional surcharge would be $184 and $120 for 51,744 12-ounce beverage cans.
The last time fuel surcharges hit a record high was in the summer of 2008, when it hit 42.25 percent, also attributed to a spike in fuel prices.
"Very shortly after that increase fuel prices started really dramatically dropping and that allowed us to make six consecutive decreases," Hull said.
The letter to customers vows that the surcharge will be adjusted accordingly if fuel prices drop.
Matson's ships burn bunker fuel, which is different from crude oil. Bunker fuel has historically been a cheaper grade of fuel but in the past two years bunker and crude have been closely aligned, Hull said.
Hull noted that the economy was in better shape in 2008 and Matson had more freight volume. That year, Matson moved 152,700 containers, while last year that figure dropped to 136,700, he said.
Large container ships travel to Honolulu from Long Beach, Calif., Oakland, Calif., and Seattle, while barges serve the outer Hawaiian islands.
Citing recent high fuel prices, Matson Navigation Company plans to raise its fuel surcharges by four percentage points, the company said Wednesday. The surcharge is to rise from 45 percent to 49 percent for services in Guam, the Commonwealth of the Northern Mariana Island and Micronesia. Matson previously announced increased surcharges on March 31.
Since then, "fuel prices not only failed to stabilize, but continued to rise," the company said in a letter to customers.
Matson touts itself as providing a lifeline to the islands, which depend on shipments of goods from the mainland. "We bring in virtually everything to support the state's economy," said spokesman Jeff Hull. "From food to automobiles to construction materials."
Under the latest increase to take effect June 12, the additional surcharge for a 40-foot container of rice would be $89, Hull said. A container holds 2,280 20-pound bags. For 24,000 heads of lettuce, the additional surcharge would be $184 and $120 for 51,744 12-ounce beverage cans.
The last time fuel surcharges hit a record high was in the summer of 2008, when it hit 42.25 percent, also attributed to a spike in fuel prices.
"Very shortly after that increase fuel prices started really dramatically dropping and that allowed us to make six consecutive decreases," Hull said.
The letter to customers vows that the surcharge will be adjusted accordingly if fuel prices drop.
Matson's ships burn bunker fuel, which is different from crude oil. Bunker fuel has historically been a cheaper grade of fuel but in the past two years bunker and crude have been closely aligned, Hull said.
Hull noted that the economy was in better shape in 2008 and Matson had more freight volume. That year, Matson moved 152,700 containers, while last year that figure dropped to 136,700, he said.
Large container ships travel to Honolulu from Long Beach, Calif., Oakland, Calif., and Seattle, while barges serve the outer Hawaiian islands.