Trans-Pacific Eastbound ocean rates on the decline
December 9, 2008 by Splatty
Filed under Seafreight
Get ready to pay less for that container of goods your are importing from China. Due to a rapidly weakening ocean market, many steamship lines are reducing ocean rates from China to the West Coast. Seems just like yesterday that the carriers were pushing for substantial increases in the GRI and fluctuating BAF surcharges. Now I am hearing many reports that some carriers are revising base rates inclusive of BAF.
If you haven’t already, now might be a good time to approach your forwarder for price concessions on your current rate levels. If no concessions are made, it might be a good time to shop rates and service.
SwizStick on Tue, 9th Dec 2008 7:49 pm
The ocean carriers are in for some seriously tough times. You have a perfect storm brewing of the following components:
1. Lots of excess vessel capacity coming online as carriers ordered a glut of vessels during the boom years.
2. Sinking demand.
3. Plummeting bunker fuel prices
4. Large retailers and importers struggling with weak sales and hence looking to cut costs any way they can.
As an importer you should definitely look to reduce ocean container freight costs through your forwarder/NVOCC or directly with the carriers, if you do direct contracts. However, be careful not to go too far in pummeling the carriers for lower rates, because no one wants bankrupt or fast-declining carriers out there mucking up the market. Service levels would plummet and when things pick up again it might be difficult to get the capacity and service you need.
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