cargo channel header

    Click below for blogs about:

  

  


  Join Us Online


     



Devin's Monthly Book Review


China Inside Out by Bill DodsonChina Inside Out
by Bill Dodson
This book deals with 10 trends shaping China and how it affects all of us.
Full Review
1 Star1 Star1 Star1 Star1 Star1/2 Star0 Stars
  5 1/2 out of 7 Stars

Subscribe by Email

Your email:

Don't have time to read?

describe the image



 

describe the image

 

 

FellowShipping Authors:

describe the image
Devin Burke, Universal Cargo CEO
With over 25 years experience in the shipping industry, Devin offers up his wisdom on the keyboard and in front of the camera. More...

describe the image
Brian Chan, The Green Logistician
Since 2003, Brian has been a logistician at UCM and promotes green practices in the shipping industry on his Green Logistician blog. More...

describe the image
Dave Stover, Account Executive
Uber-opinionated, Dave's topics have economic and socio-political themes. More...

describe the image
Jared Vineyard, UCM Content Creator
Researches and posts shipping related articles and creator of What the Freight?!?. More...

Other Blogs:

describe the image

describe the image

Most Popular Posts

Browse by Tag

Posts by Month

Now showing on The Cargo Channel



Blogarama - Blog Directory

Blog Directory

International Business Blogs - Blog Catalog Blog Directory

Current Articles | RSS Feed RSS Feed

Making up lost shipping and ocean freight revenues

Posted on Fri, Jun 04, 2010 @ 05:23 PM
  
  
  
  
  
  
Add to delicious  delicious  
  
  
...Time to "Pay The Piper"
 

In History, an old tale tells us of, the piper who was owed payment after solving an overcrowding problem for a small medieval village, dire consequences awaited the village when they tried to avoid paying the piper for his expertise in export services. 

Over the past few years, international shipping companies have been operating at significant loss in order to address demand for cargo services, especially between the U.S. west coast and Asia. 
Not so any more.
The carriers have been on a mission since last summer to raise the ocean freight rates in an effort to make back all that money they lost in ’08 and ’09.  Right now in the Pacific Rim where most traffic lies, the ocean freight rates have risen dramatically this year (between $1500-2000 a ’40) with another Peak Season Surcharge set for June 15th of $400/40 avg.  
Just as we have seen for the past few years, the Cargo Carriers also use the bunker (BAF) or floating fuel surcharge as leverage to have a reason to raise the rates if they have contracts locking in prices with their customers.
As we notice the price of a barrel of oil has decreased recently from $90 to $70 a barrel, of course the ocean freight or BAF has not decreased, it has not changed.  However when the price of oil goes back up again, which you can bet on given the recent Gulf mess, there is a high likelihood that the bunker will increase again sometime this year.  Otherwise you may find more “space problems”. SOURCE: Hellenic Shipping News
 
The cost to produce/extract mineral/fossil fuels goes up when disasters like our oil spill in the Gulf. Especially as resource exploration and drilling production regulations adjust to prevent similar disasters in the future. BOTTOM LINE: Get your shipping contracts in place sooner rather than later to lock in your ocean freight rates.
Tags: , , , ,

Comments

Currently, there are no comments. Be the first to post one!
Post Comment
Name
 *
Email
 *
Website (optional)
Comment
 *

Allowed tags: <a> link, <b> bold, <i> italics