Volume 23, Number 9
September 4, 2019
Oakland, California
SIGNALS™ provides detailed information on the regulations and activities of the US Federal Maritime Commission (FMC), and related developments in the ocean freight industry. For past issues, please consult our index.
Signals™ Headlines - September 4, 2019

Puerto Rico Terminal Agreement Draws Extra Attention from FMC

The Federal Maritime Commission announced it allowed the Puerto Nuevo Terminals LLC Cooperative Working Agreement (FMC Agreement No. 201292) to take effect on August 29, 2019, but will closely monitor this agreement to ensure it is not implemented in a manner that violates the Shipping Act.

Under the terms of the Puerto Nuevo Terminals LLC Cooperative Working Agreement, the marine terminal operating companies Luis Ayala Colon (LAC) and Puerto Rico Terminals (PRT), an affiliate of Tote Maritime, will form a new company named Puerto Nuevo Terminals (PNT), a Puerto Rico limited liability company, to operate a marine terminal and provide container stevedoring, terminal and related services in the Port of San Juan, Puerto Rico. PNT will acquire all terminal services agreements, land leases, cranes, yard equipment and other related assets from LAC and PRT. Thereafter, PNT, through its single management team and board of directors, will negotiate and enter into all terminal services agreements, crane and other yard equipment purchases or leases, coordinate labor for on dock stevedoring and all other matters related to the normal operation of a marine container terminal. LAC and PRT will withdraw from that business leaving PNT and the Crowley container terminal as the only two container terminal operators in San Juan, Puerto Rico.

The Commission is concerned that once the Puerto Nuevo Terminals LLC Cooperative Working Agreement takes effect the resulting reduction in competition may produce an unreasonable reduction in transportation service or an unreasonable increase in transportation cost. Many parties filed comments with FMC in recent months which expressed serious concerns about this agreement’s potential impact on competition as well as on transportation costs. However, the Commission noted PNT has negotiated concessions to maintain current 2019 rate levels through 2020, with limited exceptions.

While it allowed the Puerto Nuevo Terminals LLC Cooperative Working Agreement to take effect as requested on August 29, 2019 the Commission said it intends to examine available options to ensure the Agreement does not violate the Shipping Act. Under its authority, the Commission will order “an enhanced monitoring regime” for this agreement with extensive disclosure of business and marketplace information required. Further, the Commission may order investigational hearings requiring the parties to provide additional information to the Commission. Chairman Khouri stated, “we understand what the parties are trying to achieve, but serious concerns remain about the implementation of the agreement. The Commission will take necessary measures to ensure that the agreement is not implemented in a manner that violates the Shipping Act.”

Transpacific Eastbound Carriers Adjust Fuel Surcharges Effective October 1, 2019

Most of the leading container carriers serving the East Asia/USA trade lanes (U.S. Imports) have adjusted fuel surcharges, including bunker adjustment factors (BAF) effective October 1 through December 31, 2019. Details are as follows. Here is a table of carriers that have recently posted revised BAF amounts in their FMC tariffs:

TRANSPACIFIC EASTBOUND (Asia to USA)
BUNKER ADJUSTMENT FACTOR (BAF), Oct – Dec 2019, in USD, per 40ft ctr
Carrier
To US Atlantic/Gulf Coast Ports
To US Pacific Coast Ports
To IPI/MLB via US Pacific Coast
Dry
Reefer
Dry
Reefer
Dry
Reefer
APL
660
792
405
486
653
784
CMA CGM
(see note 5)
704
792
432
486
432
486
COSCO
727
1227
385
650
385
650
Evergreen
(see note 5)
941
1360
386
614
386
614
Hyundai
728
397
645
ONE
(see note 5)
789
420
668
OOCL
(see note 5)
802
414
658
Yang Ming
(see note 5)
600
330
330

NOTE 1: CMA CGM calls the above Bunker surcharge the fluctuating Bunker Surcharge (BAF03).

NOTE 2: ONE calls the above Bunker surcharge the Bunker Adjustment Factor (BAF). ONE also filed a ONE Bunker Surcharge (OBS) in its FMC tariff. Tariff rates which are published prior to January 1, 2019 shall be subject to BAF for their duration, unless otherwise excepted in the rate itself; all TRIs published after January 1, 2019 shall be subject to OBS.

NOTE 3: APL calls the above Bunker Surcharge (BAF03), which is applicable to service contracts or tariff rate items with validity greater than three months and are not subject to Bunker Surcharge (BAF08). APL has also filed in its FMC tariff a Market Adjustment Factor (MAF) of USD 4000/5000/5625/6330/4250 per 20ft/40ft/40HC/45ft/RD40ft container, effective September 14, 2019 thru April 30, 2020. The MAF applies to Service Contracts only, and is applicable to Transpacific Eastbound dry and reefer cargo.

NOTE 4: OOCL calls the above Bunker Charge. This Bunker Charge is not applied to shipments when Fuel Cost Recovery Charges are already applied or included in the base rate. The Fuel Cost Recovery Charges effective 01Oct2019 are USD 486 per 40ft dry and USD 820 per 40ft reefer for WC (U.S. West Coast, Group 4); USD 730 per 40ft dry and USD 1233 per 40ft reefer for other WC (other than U.S. West Coast, Group 4); and USD 964 per 40ft dry and USD 1627 per 40ft reefer for all other US destinations.

NOTE 5: Subject to Low Sulphur Fuel Charge (LSF or LSS).

Transpacific Eastbound Carriers File GRIs Effective September 15 and October 1, 2019

Several leading carriers serving the Trans Pacific container trades have recently updated their respective tariffs to include new General Rate Increases (GRIs) effective September 15, 2019, including American President Lines (APL), CMA CGM, COSCO, Evergreen, Hapag Lloyd, Hyundai Merchant, Ocean Network Express (ONE), and Yang Ming. See table below for GRI amounts per 40ft container; GRI amounts for all other container sizes are as per formula. The September 15th GRIs will be the eighteenth GRI of 2019 for the East Asia/USA trade lane.

TRANSPACIFIC EASTBOUND (Asia to USA)
GENERAL RATE INCREASE (GRI)
Effective September 15, 2019
Carrier
in USD, per 40ft ctr
APL
1000
CMA CGM
1000
COSCO (see note 1)
800
Evergreen
1000
Hapag Lloyd
700
Hyundai
1000
ONE
1000
Yang Ming
1000

NOTE 1: COSCO GRIs apply on all cargo moving under service contracts only.

Some carriers updated their tariffs to include new General Rate Increases (GRIs) effective October 1, 2019, including American President Lines (APL), CMA CGM, COSCO, Evergreen, Hapag Lloyd, Hyundai Merchant, Ocean Network Express (ONE), and Yang Ming. See table below for GRI amounts per 40ft container; GRI amounts for all other container sizes are as per formula. The October 1st GRIs will be the nineteenth GRI of 2019 for the East Asia/USA trade lane.

TRANSPACIFIC EASTBOUND (Asia to USA)
GENERAL RATE INCREASE (GRI)
Effective October 1, 2019
Carrier
in USD, per 40ft ctr
APL
1000
CMA CGM
1000
COSCO (see note 1)
800
Evergreen
1000
Hapag Lloyd
700
Hyundai
1000
ONE
1000
Yang Ming
1000

NOTE 1: COSCO GRIs apply on all cargo moving under service contracts only.

Transpacific Westbound Carriers Update Fuel Surcharges Effective October 1, 2019

Several carriers serving the USA/East Asia trade lanes (U.S. Exports) have adjusted their fuel surcharges for the October to December 2019 quarter. Here is a table of carriers that have posted BAF amounts:

TRANSPACIFIC WESTBOUND (USA to Asia)
BUNKER ADJUSTMENT FACTOR (BAF), Oct – Dec 2019, in USD, per 40ft ctr
Carrier
Dry Cargo
Reefer Cargo
From US Atlantic/Gulf Coast Ports
From US Pacific Coast Ports
From US Atlantic/Gulf Coast Ports
From US Pacific Coast Ports
APL
0
0
0
0
CMA CGM
(see note 5)
0
0
0
0
COSCO
117
53
176
80
Evergreen
(see note 5)
224
107
596
300
ONE
(see note 5)
1078
579
1414
798
OOCL
(see note 5)
1044
551
1369
752
Yang Ming
(see note 5)
300
180
432
259

NOTE 1: Yang Ming calls the above Bunker surcharge the New Bunker Charge (NBC).

NOTE 2: CMA CGM calls the above Bunker surcharge the fluctuating Bunker Surcharge (BAF03).

NOTE 3: ONE calls the above Bunker surcharge the Bunker Adjustment Factor (BAF). ONE also filed a ONE Bunker Surcharge (OBS) in its FMC tariff. Tariff rates which are published prior to January 1, 2019 shall be subject to BAF for their duration, unless otherwise excepted in the rate itself; all TRIs published after January 1, 2019 shall be subject to OBS.

NOTE 4: OOCL calls the above Bunker Charge. This Bunker Charge is not applied to shipments when Fuel Cost Recovery Charges are already applied or included in the base rate. The Fuel Cost Recovery Charges effective 01Oct2019 are USD 70 per 40ft dry and USD 105 per 40ft reefer for U.S. West Coast; and USD 79 per 40ft dry and USD 118 per 40ft reefer for all other US origins.

NOTE 5: Subject to Low Sulphur Fuel Charge (LSF or LSS).

NOTE 6: APL’s global rules tariff AP01 for this trade lane confirms Bunker Surcharge/BAF amount of zero; see, Rule 10-Section B03.

Caribbean Shipowners Association Announces Peak Season Surcharges, and Maintain Fuel

The Caribbean Shipowners Association (CSA), FMC Agreement No. 010979, recently announced a Peak Season Surcharge (PSS) which will apply from September thru January. The CSA Carrier members serve trade lanes between the United States and the Caribbean destinations located in the Leeward/Windward Islands (excluding Guadeloupe, Martinique, Saint Barthelemy, French/Dutch Saint Maarten), Trinidad, Guyana, Suriname, Haiti, the Cayman Islands, the Bahamas, Jamaica.

See table for the Peak Season Surcharge (PSS) that apply from September 22, 2019 through January 5, 2020.

From USA to the Caribbean
PEAK SEASON SURCHARGE (PSS), Sep 22, 2019– Jan 5, 2020, in USD
To Caribbean, except as noted
To Cayman Islands
Equipment Size
Dry
Reefer
Equipment Size
Dry
Reefer
20ft
200
250
20ft
75
100
40ft
400
500
40ft
150
200
40ft+
450
n/a
40ft+
169
225
Below amounts vary by carrier; see Notes
Below amounts vary by carrier; see Notes
Vehicle up to 700 cft
118
n/a
Vehicle up to 700 cft
45
n/a
Breakbulk (w/m)
9.41
n/a
Breakbulk (w/m)
3.60
4.80
LCL, M (1 cft)
0.24
n/a
LCL, M (1 cft)
0.09
0.12
CWT (100 lbs)
0.48
n/a
CWT (100 lbs)
0.18
0.24

NOTE 1: Breakbulk (w/m) means per each 2000 lbs (W) or 40 cft (M).

NOTE 2: Tropical Shipping and Construction will apply USD200 per vehicle not exceeding 700 cft; USD10 per W/M for breakbulk; USD0.25 per CFT; USD0.50 per CWT; USD3.75 per barrel; USD20 per pallet. Tropical will apply the same amounts for the Cayman Islands.

NOTE 3: Seaboard Marine will apply USD8.50 per W/M for breakbulk, and USD3.20 per W/M for breakbulk for the Cayman Islands.

From USA to the Caribbean
MARINE FUEL, in USD, per 40ft ctr
Carrier
To Caribbean, exept as noted
To Cayman Islands
Dry Cargo
Reefer Cargo
Dry Cargo
Reefer Cargo
Seaboard
400
520
260
520
King Ocean
400
520
400
520
Crowley Caribbean
732
847
470
470

NOTE 1: Amounts differ for W/M and vehicle units.

NOTE 2: Seaboard Marine has also published amounts for Vessel Fuel Charges for Cayman Islands in the amount of USD500 per 40ft dry; USD510 per 40ft reefer; USD11.14 per W/M; USD159 per vehicle not exceeding 700 cft; USD11.14 per W/M for vehicles exceeding 700 cft. All other sizes per container formula.

NOTE 3: King Ocean calls the above charges the Vessel Fuel Surcharge Adjustment.

CSA members are Seaboard Marine, Tropical Shipping and Construction, King Ocean Services, Crowley Caribbean, and Hybur. For more information see individual carrier tariffs.

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