Lines to push for US$300 teu hike on import boxes

An ambitious push on general rate increases is planned for mid-to-end March, timed to coincide with a planned squeeze on capacity.

Shipping lines will push for a US$300 hike per teu on import boxes in late March to bring the current US$800-850 figure up over the four digit mark, which lines regard as the minimum for breakeven, sources have said.

This push is planned to coincide with a reduction in carrier capacity, particularly with the exit of shipping line Posa from the Australian market.

An executive at Posa, which was pulled from the market by its owner, the Hai Nan Economical Council in China, has previously commented that the: “Chinese network of agents always filled the vessels southbound – often there was no space left even to load an empty reefer box to Australia.”

He added that Posa enjoyed broad support from shippers of grain, cotton, wastepaper and logs.

Additionally, liner executives said that, in addition to the exit of Posa, carriers are reducing capacity by blanking out sailings.

Reduced sailings and the exit of Posa ought to mean more cargo for the other lines and, as one executive commented”: “Posa were notorious for cheap rates,” so there are some indications this price increase may stick.

However, executives are not bullish that the full figure will stick, adding that lines tried to push up the China trade rates by US$300 in January, of which about US$50 stuck.

“I wouldn’t have thought it would stick in the current climate, but if at least part of it will stick then it’s better than nothing,” said one source.

Another added that while: “it’s a hard rate to increase during the lean season, all the lines are pushing for it now. It’s quite ambitious but it is necessary. Import rates need to cover export rates and stevedoring.”

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