Transpacific Shipping Lines to Adjust Fuel Surcharges Monthly

Change in calculation method is intended to stabilize cost impacts to customers amid fluctuating fuel prices.

Oakland, California / January 26, 2006 – Container shipping lines in the Transpacific Stabilization Agreement (TSA) have announced an upcoming change in the way they calculate and adjust bunker and inland fuel surcharges.

Effective May 1, 2006, TSA member lines will shift from quarterly to monthly adjusted fuel surcharges, in an effort to moderate cost impacts and make the surcharges more responsive to market conditions.  

Fuel surcharges, added on to base freight rates, are designed to float with prices for marine fuel and help recover sudden and sustained cost increases in a volatile market. Carriers typically apply two surcharges, one for marine “bunker” fuel used aboard ship and the other for truck, rail and equipment diesel fuel used in connection with shoreside and inland operations. 

“Fuel prices have been so volatile in recent months that the lag time between collection of fuel price data and quarterly surcharge adjustments has made it difficult for shippers to plan their costs and for carriers to recover theirs,” said TSA Executive Director Albert A. Pierce. “Lines feel that a more timely calculation method in this kind of environment would be helpful to everyone.” 

TSA is a voluntary discussion and research forum of 11 major container shipping lines serving the trade from Asia to ports and inland points in the U.S.

Members include:

American President Lines, Ltd.
COSCO Container Lines, Ltd.
Evergreen Marine Corp. (Taiwan), Ltd.

Hanjin Shipping Co., Ltd.
Hapag Lloyd Container Lines
Hyundai Merchant Marine Co., Ltd.
Kawasaki Kisen Kaisha, Ltd. (K Line)

Mitsui O.S.K. Lines, Ltd.

Nippon Yusen Kaisha (N.Y.K. Line)
Orient Overseas Container Line, Inc.
Yangming Marine Transport Corp.


Contact: Niels Erich
T: (415) 543-6048
F: (415) 358-4540
E: nerich@pacbell.net


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