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Signals™ Headlines - December 3, 2009

FMC Chairman Lidinsky Encourages Public Participation in EU Study

Federal Maritime Commission Chairman Richard Lidinsky announced details of the
FMC’s plan to undertake a comprehensive study of the impact of the European Union’s elimination of shipping
conferences on U.S. trades.  In his address to the Intermodal Association of
North America
, The National Industrial Transportation League, and the Transportation Intermediaries Association during the
Super Session
– “Economic Turmoil in a Sea of Financial Changes
discussion at the 2009 Intermodal Expo and TransComp Exhibition, Lidinsky announced further
details of the Commission’s plans and requested input from maritime industry stakeholders.  

In his remarks to the ports, carriers and other maritime partners, Lidinsky made a point to recognize the impact of
the on-going global economic downturn on the industry.  He also reiterated the Obama Administration’s willingness to
assist regulated parties in obtaining financial relief.

According to Lidinsky, the Commission’s study will cover two years before and after the October 2008 EU repeal of
its block exemption for liner conferences.  It will include analysis of changes in carrier market structures,
competition, agreements, services, vessel capacity, rates and surcharges.  The study will also explore the
extent to which the repeal altered liner cargo growth and/or the mix of commodities shipped and the competitiveness
of U.S. container exports.

The Commission has also recently begun consulting with key stakeholders to discuss parameters of the study,
proposed methodologies, industry interviews, and study milestones.  The FMC will also publish a general Notice
of Inquiry asking for input and data from interested parties in the later half of 2010.

FMC Chairman Lidinsky Announces Maritime Environmental Advisory Committee

FMC Chairman Richard Lidinsky recently announced the formation of an internal Maritime Environmental Advisory Committee to
provide leadership in identifying and supporting the creation of green jobs in the maritime industry. The FMC
stressed that the formation of the Committee is in line with the Obama Administration’s goals of creating green jobs
and seeking a more sustainable approach to maritime issues.  Through the Committee the FMC is also seeking to
demonstrate a commitment to a new and proactive relationship with the country’s ports.

The Maritime Environmental Advisory Committee will work closely with the FMC to identify current or proposed
environmental initiatives by the ports and the shipping industry. “We want to provide a clearing house for
ports, terminal operators and other shipping interests to review agreements and other operational initiatives, and
to discuss how commercial efforts can be enhanced by adopting certain environmental and energy efficiency standards
consistent with the shipping acts and regulations administered by the Commission,” said Lidinsky.

Lidinsky announced the initiative during his first formal port visit as Chairman. Lidinsky was visiting the
container port complex of Los Angeles and Long Beach to observe the ports’ Clean Trucks Programs in action.  Lidinsky
commended the ports saying, “I wanted to recognize these ports’ leadership in demonstrating that the maritime
industry can remain commercially competitive while acting in a manner consistent with the country’s commitment to
energy independence and environmental standards.”  This is a complete turnaround from November 2008, when the
FMC sought a permanent injunction to the Clean Truck Programs in Federal District Court. The FMC withdrew this challenge earlier this year in
June, after their request for a preliminary injunction was denied. 

The Maritime Environmental Advisory Committee will be led by Mark K. Dowd, Counsel to the Chairman, and draws its
members from the numerous disciplines at the Commission.

WTSA Carriers Increase Surcharges and Rates

The Westbound Transpacific Stabilization Agreement (WTSA), FMC Agreement No. 011325, whose member
lines serve the U.S. export trades from the USA to East Asia, announced increased surcharges for the period of
January 1, 2010 to March 31, 2010. The WTSA also announced recommendation for December and January general rate
increases (GRIs).

WTSA’s new formula BAF for the period of January to March 2010 will be increased as follows: from/via U.S.
Atlantic/Gulf Coast Ports – US$ 799 per 20ft dry ctr, US$ 999 per 40ft/45ft dry ctr and US$ 1330 per 40ft/45ft
reefer ctr; from/via U.S. Pacific Coast Ports – US$ 402 per 20ft dry ctr, US$ 503 per 40ft/45ft dry ctr and US$ 708
per 40ft/45ft reefer ctr.  Inland Fuel Charges (IFC) for the same period will be increased to US$ 200 per ctr for
rail and intermodal rail/truck shipments, and to US$ 58 per ctr for local/regional truck shipments.  Currency
Adjustment Factors (CAF) for January – March 2010 are as follows: Japan 0%, Korea 0%, Taiwan 5% (up from 4%) and
Singapore 16% (up from 15%). 

The WTSA also recommended general rate increases (GRIs) to take effect December 1, 2009 and January 15, 2010.
Effective December 1, WTSA lines have recommended increases to dry cargo rates – including rates for commodities
exempt from tariff filing – in the amounts of US$ 100 per 40-foot ctr and US$ 80 per 20ft ctr for cargo originating
at the ports of Los Angeles and Long Beach on the U.S. West Coast; and by US$ 150 per 40ft ctr and US$ 120 per 20ft
ctr for all other dry cargo, including other West Coast ports, all-water shipments via the U.S. East and Gulf
Coasts, and intermodal moves.  The WTSA lines are also recommending GRIs for refrigerated cargo effective January
15, 2010.

WTSA is a voluntary discussion and research forum of 10 container shipping lines serving the trade from ports and
inland points in the U.S. to destinations throughout Asia. The WTSA’s 10 member carriers are American
President Lines, COSCO Container Lines, Evergreen Marine Corp., Hanjin Shipping, Hapag-Lloyd Container Line,
Hyundai Merchant Marine, “K” Line, NYK Line, OOCL
and Yang Ming Marine.
 For more info visit www.wtsacarriers.org.

 TSA Carriers Increase Fuel Surcharges; Plan GRIs

The carrier members of the Transpacific Stabilization Agreement (TSA), FMC Agreement No. 011223,
serving the East Asia/USA trade lane announced increases to surcharges. 

Effective January 1, 2010 Bunker Adjustment Factors (BAF) calculated using TSA’s old monthly BAF formula will be
increased to US$ 688 per 20ft ctr, US$ 860 per 40ft ctr, US$ 968 per 40ft hi-cube ctr, US$ 1089 per 45ft ctr, and
US$ 19 per WM (LCL).  Old formula BAF amounts are filed in the tariffs of most of TSA carriers and apply on cargo
moving under tariff rates or 2008 service contracts that remain in effect.  Quarterly BAF according to TSA’s new
formula will also increase as follows: January 1 thru March 2010: shipments via West Coast Services – US$ 278 per
20ft ctr, US$ 348 per 40ft ctr, US$ 392 per 40ft hi-cube ctr, US$ 440 per 45ft ctr; shipments via East Coast
Services – US$ 551 per 20ft ctr, US$ 689 per 40ft ctr, US$ 775 per 40ft hi-cube ctr, US$ 872 per 45ft ctr. 

Inland Fuel Charges (IFC) and Currency Adjustment Factor (CAF) for the January to March 2010 period will be
increased.  The IFC will be US$ 200 per ctr for shipments to IPI destinations served via West Coast Ports, US$ 100
per ctr to RIPI destinations served via East Coast Ports, and US$ 58 per ctr to Group 4 Points in California,
Oregon and Washington and to East Coast local store door points.  CAF for shipments from Japan will be increased
from 14 to 16 percent.

The general rate increases (GRIs) planned by the TSA Carriers for 2010 might be implemented prior to May 1st.
Some member carriers are anxious to increase depressed rates and may do so by imposing GRIs earlier in the year,
or by filing a new Contingency Surcharge in their tariffs.  The full GRI amounts recommended by the carriers for
2010 are $800 per FEU to US West Coast ports and $1000 per FEU to US East Coast ports and inland destinations. 
One non-TSA member, CMA-CGM, has already announced a GRI at these levels effective 01Jan2010.

In other news, Maersk Line recently applied to rejoin
the TSA effective December 24, 2009 pending FMC approval. The TSA’s 14 carrier members are American
President Lines, CSCL, CMA-CGM, COSCO Container Lines, Evergreen Marine, Hanjin Shipping, Hapag-Lloyd Container
Line, Hyundai Merchant Marine, “K” Line, Mediterranean Shipping, NYK Line, OOCL, Yang Ming Marine
and Zim Integrated Shipping Services.  Visit www.tsacarriers.org

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Vol. 13 No. 12, December 3, 2009

The information contained herein is obtained from reliable sources.
It is subject to change at any time, however, depending on changes in
laws and regulations. While we continually attempt to monitor this
information, we do not guarantee its accuracy and are not responsible
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