SHIPPING lines in the Transpacific Stabilisation Agreement (TSA) after a Hong Kong meeting this week warned shippers they could not expect rock bottom freight rates to continue after January.
"No one should expect to see freight rates extended at current levels in 2009-10 contracts. To maintain current rates over an 18-month time frame would threaten the financial viability of any major carrier in the market today," said TSA executive administrator Brian Conrad, adding that rates had been taken to "non-remunerative levels".
TSA members and non-members have participated in rate cutting, said Mr Conrad. "The rate actions seen in recent weeks are short-sighted and regrettable. They haven't produced new business; they haven't increased anyone's market share and they do not adequately reflect operating costs," he said.
Mr Conrad added that TSA lines have indicated they "do not intend to leave those rates in place beyond January 31".
Said Mr Conrad: "It's TSA's hope that the trade as a whole will take a step back and reconsider the financial impacts of recent actions, in the face of widely reported carrier losses and service consolidations."
TSA, a quasi-conference, describes itself as a research and discussion forum of major container shipping lines serving the trade from Asia to ports and inland points in the US.
TSA members include are APL, Hyundai Merchant Marine, China Shipping Container Lines, "K" Line, CMA-CGM, MSC Cosco, NYK, Evergreen, OOCL, Hanjin Shipping, Yangming, Hapag-Lloyd and Zim.
"No one should expect to see freight rates extended at current levels in 2009-10 contracts. To maintain current rates over an 18-month time frame would threaten the financial viability of any major carrier in the market today," said TSA executive administrator Brian Conrad, adding that rates had been taken to "non-remunerative levels".
TSA members and non-members have participated in rate cutting, said Mr Conrad. "The rate actions seen in recent weeks are short-sighted and regrettable. They haven't produced new business; they haven't increased anyone's market share and they do not adequately reflect operating costs," he said.
Mr Conrad added that TSA lines have indicated they "do not intend to leave those rates in place beyond January 31".
Said Mr Conrad: "It's TSA's hope that the trade as a whole will take a step back and reconsider the financial impacts of recent actions, in the face of widely reported carrier losses and service consolidations."
TSA, a quasi-conference, describes itself as a research and discussion forum of major container shipping lines serving the trade from Asia to ports and inland points in the US.
TSA members include are APL, Hyundai Merchant Marine, China Shipping Container Lines, "K" Line, CMA-CGM, MSC Cosco, NYK, Evergreen, OOCL, Hanjin Shipping, Yangming, Hapag-Lloyd and Zim.