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ALG CONNECT Newsletter May 16, 2012
ALG Connect Newsletter 5/16/2012
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Trans-Pacific Carriers Plan Westbound Rate Hikes
Bill Mongelluzzo, Associate Editor | May 8, 2012 4:25PM GMT
The Journal of Commerce Online - News Story
WTSA recommends increases for shipments of frozen and chilled beef, pork and poultry ...
Trans-Pacific carriers announced proposed rate increases of $300 to $400 per 40-foot container unit, effective July 1, on shipments of frozen and chilled beef, pork and poultry shipments exported from the U.S. to Asia.
The Westbound Transpacific Stabilization Agreement, a discussion group of 10 carriers, announced the non-binding rate guidelines for the so-called protein cargoes.
Protein shipments moving from West Coast ports to Asia would take a $300 per FEU increase, while intermodal shipments and cargoes moving via all-water services from East Coast ports to Asia would take a $400 increase if the carriers implement the proposed rate hikes. Also, rates for hides would increase $100 from all locations.
The WTSA is a discussion agreement. It has no enforcement powers and its guidelines are voluntary, but the WTSA announcements generally reflect market conditions in the westbound Pacific trade.
Brian Conrad, WTSA executive administrator, said Asian demand for chilled and frozen meat is strong. Also, the westbound Pacific is competing with other trade lanes for a limited supply of refrigerated equipment, especially temperature-controlled containers for carrying chilled products.
Frozen and chilled meat products normally move under 12-month contracts that run from July 1 through June 30 of the next year, Conrad said.
Recession Cuts Into European Port Traffic
Joseph Bonney, Senior Editor | May 9, 2012 4:55PM GMT
The Journal of Commerce Online - News Story
Containerized imports down 1.1 percent through February ...
Imports at Europe’s largest container ports declined 1.1 percent in the first two months of this year as economic problems cut into demand, according to Global Trade Tracker’s Northern Europe Trade Outlook.
Exports jumped 10.7 percent, but import volumes have been weakened by austerity-driven measures that have left North Europe in "a mild recession," said Ben Hackett of Hackett Associates, which produces the report with the Bremen-based Institute of Shipping Economics and Logistics.
March import volumes edged up 0.5 percent, while exports rose 4.2 percent, Hackett said. "The weakness in all the short-term leading indicators, combined with the economic and political uncertainty within the euro zone, is driving the consumers’ cautious approach to spending," Hackett said.
The Port Tracker report forecasts imports will rise 2.4 percent for all of 2012, with a 2.8 percent increase expected in North Europe ports and 1.4 percent growth in the Mediterranean and Black Sea region.
Exports excluding short-sea shipments are expected to rise 4.3 percent this year, with exports growing 6.2 percent in North Europe ports but falling 0.5 percent in the Mediterranean and Black Sea region.
Economist: Full Export Recovery in China Far From Certain
Mike King, Special Correspondent | May 11, 2012 1:51PM GMT
The Journal of Commerce Online - News Story
Domestic market remains weak, crimping import growth; bearish demand from overseas markets slows exports ...
China’s domestic market remains shaky and a full export recovery is far from certain, a leading economist says. IHS Global Insight’s Alistair Thornton said trading figures for April revealed domestic weakness had been compounded by bearish demand from key markets overseas, especially Europe. "Whichever way you slice them, export growth is weak, and import growth is weaker," he said.
After China’s exports increased 8.9 percent in March, growth slowed in April to 4.9 percent, far lower than the 20.6 percent growth achieved last year, and a slower rate than most analysts had predicted, not least because China’s official Purchasing Managers’ Index for April suggested a trading recovery was under way.
China also saw import growth decline 0.3 percent year-over-year in April, down from the 5.3 percent growth recorded in March and the 25 percent year-over-year average of 2011.
While China’s exports to the U.S. increased 10 percent last month, it was not enough to compensate for 2.4 decline in exports to the EU, the third consecutive month of sub-zero growth. "From the external side, it is fairly clear where this weakness is coming from," Thornton said. "Over the first four months, the European Union saw bilateral trade grow only by 0.3 percent year-over-year, sharply down from the 2.6 percent year-over-year number for the first three months."
April’s import growth figures were the worst since October 2009 as imports totaled just $145 billion, down from the recent peak of $160 billion in November. Thornton said sluggish domestic demand for imports was due to broad weakness across the "fragile" Chinese.
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