TSA members call for authority to hold capacity talks

CONTAINER shipping lines in the Transpacific Stabilisation Agreement, which handle 85 per cent of Asia-US cargo, are seeking permission from the US Federal Maritime Commission to extend the group's authority to hold capacity talks.

The 14 TSA members are calling for language to be added that would allow TSA members to discuss and reach agreements on cost savings and more efficient use of vessel and equipment assets and networks, reports American Shipper. TSA's proposed discussion agreement, filed with the FMC, would take effect February 1.

The proposed amendments seek "coordination of the members' capacity plans, lay-up, dry-docking, or other off-hiring of vessels, rationalisation of vessels and/or vessel capacity operated, or planned to be operated" by both TSA members or feeder ships employed by TSA members.

The call for changes to be made to the agreement comes as the TSA warns of prospects of a sustained downturn in the container shipping industry, according to Niels Erich, a spokesman for the TSA, who said members are scrambling to find cost savings.

He was quoted as saying in the report that TSA members need every tool in the kit to make sure their fleets are scaled properly.

TSA members anticipate that full-year figures will show that cargo demand fell by up to 8 per cent in 2008 compared to the previous year, and they are not optimistic that the market will recover until the second half of 2009.

TSA's members include APL, China Shipping Container Lines, CMA CGM, Cosco Container Lines, Evergreen, Hanjin Shipping, Hapag-Lloyd, Hyundai Merchant Marine, K Line, MSC, NYK Line, OOCL, Yangming and Zim Integrated Shipping Services.

Source: American Shipper