Transpacific Stabilization Agreement

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Transpacific Lines Grapple with
Inland Transport Crisis


Truck and driver shortages, rail and terminal congestion have pushed up intermodal rates and cargo handling costs.


Oakland, CA / October 20, 2014 – Congested U.S. port terminals, harbor and over-the-road truck and driver shortages, slower trains and longer rail terminal dwell times due to increased domestic rates have not only disrupted service but also driven intermodal rates and cargo handling costs up sharply. Asia-U.S. container lines, still heavily reliant on intermodal service, have now been forced to respond with intermodal door delivery charges to recover those costs.

As announced previously, most member lines in the Transpacific Stabilization Agreement (TSA) are moving forward individually with charges of US$100 per 40-foot container (FEU),  and USD90 per 20ft container, effective on or around November 15, 2014, but by no later than December 1. The charges apply to all cargo moving under intermodal store-door delivery through rates from Asia to the U.S.

TSA executive administrator Brian Conrad noted that congestion and associated costs are the result of a convergence of factors, among them equipment interchange issues, railcar shortages, freight backup at intermodal terminals and a shift of intermodal cargo to more costly pure truck moves. “These are systemic issues that will get resolved over time, but in the midst of the peak season and with demand still strong, we don’t have time,” he said. “Carriers are doing their best given the service and infrastructure constraints we see across the supply chain. For now, as we all work on solutions, the key is cost recovery.”

TSA is a research and discussion forum of major container shipping lines serving the trade from Asia to ports and inland points in the U.S.

TSA Members:

APL Ltd.
China Shipping Container Lines
CMA-CGM
COSCO Container Lines, Ltd.
Evergreen Line
Hanjin Shipping Co., Ltd.
Hapag-Lloyd AG
Hyundai Merchant Marine Co., Ltd.
Kawasaki Kisen Kaisha, Ltd. (K Line)
Maersk Line
Mediterranean Shipping Co.
Nippon Yusen Kaisha (N.Y.K. Line)
Orient Overseas Container Line, Inc.
Yangming Marine Transport Corp.
Zim Integrated Shipping Services


Contact:

Niels Erich
T: (415) 525-4520
E: n.erich@comcast.net


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