Shippers resist lines’ rate increases

As shipping lines on some trades try to breathe some life into their freight rates – currently verging on subeconomic levels – shippers who fork out the cash are adamant that higher rates won’t stick in the current extremely tight conditions. Among the lines pushing up rates are those on the transpacific trade which are all quoting significant rate increases. One of the latest reports on the net from container trade analyst Drewry shows that in the second week of August shipping lines pushed up rates by 57.4% to US$1 371 per 40-foot box. However, the rates are still 34.4% down on this time last year. Drewry’s Philip Damas pointed out the new rates did not apply to annually negotiated contracts, and added that the increase was down to a narrowing between supply and demand. But John Lu, chairman of the Asian Shippers’ Council, told International Freighting Weekly (IFW): “It’s not a good time to do this [increasing rates]. The economic situation is still quite bad and there’s substantial over-capacity.” Drewry’s rates are derived from Hong Kong non-vesseloperating common carriers (NVOCCs).