Freight rate hikes by the Panama Canal Authority have begun trickling down as shipping lines on the westbound transpacific trade from the East Coast US to Asia have announced plans to raise surcharges for carrying cargo through the canal.
Costly transit: Westbound carriers shipping cargo from the US to Asia are doubly hit by canal transit costs due to the high volume of empty containers
Effective June 1, the 10 Westbound Transpacific Stabilisation Agreement (WTSA) member lines - including Neptune Orient Lines' APL liner division - will raise their canal surcharges to US$212 per container.
For cargo rated on a weight or measurement basis the hikes will amount to either $11.50 per metric ton or $4.50 per cubic metre respectively.
'The increases will bring charges into line with what is being charged by carriers in other trades shipping containers freight via the canal today,' the WTSA said in a statement adding these increases are the first in two years.
The canal authority changed the way transit fees are assessed in 2005, shifting to a per container formula from one based on vessel weight. These rates were then raised under annual increases, the WTSA said.
'Westbound carriers shipping cargo from the US to Asia are doubly impacted by canal transit costs due to the high volume of empty containers being repositioned with no revenue to offset fees collected,' they said.
The authority recently gained approval from the Panama government to increase transit fee increases of 10 per cent annually over 2007-09, including an increase in the fee formula for empty containers, originally effective May 1.
But the authority announced recently that, at the request of industry, it was postponing the start of the new fee structure from May to July to give users the chance to study modifications to its pricing proposals first published in February.
The canal authority has pledged to fully fund a historic US$5.25 billion expansion of the 93-year-old canal through toll hikes.
Costly transit: Westbound carriers shipping cargo from the US to Asia are doubly hit by canal transit costs due to the high volume of empty containers
Effective June 1, the 10 Westbound Transpacific Stabilisation Agreement (WTSA) member lines - including Neptune Orient Lines' APL liner division - will raise their canal surcharges to US$212 per container.
For cargo rated on a weight or measurement basis the hikes will amount to either $11.50 per metric ton or $4.50 per cubic metre respectively.
'The increases will bring charges into line with what is being charged by carriers in other trades shipping containers freight via the canal today,' the WTSA said in a statement adding these increases are the first in two years.
The canal authority changed the way transit fees are assessed in 2005, shifting to a per container formula from one based on vessel weight. These rates were then raised under annual increases, the WTSA said.
'Westbound carriers shipping cargo from the US to Asia are doubly impacted by canal transit costs due to the high volume of empty containers being repositioned with no revenue to offset fees collected,' they said.
The authority recently gained approval from the Panama government to increase transit fee increases of 10 per cent annually over 2007-09, including an increase in the fee formula for empty containers, originally effective May 1.
But the authority announced recently that, at the request of industry, it was postponing the start of the new fee structure from May to July to give users the chance to study modifications to its pricing proposals first published in February.
The canal authority has pledged to fully fund a historic US$5.25 billion expansion of the 93-year-old canal through toll hikes.