Cargo Business News

February 2013

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6 T News,Trends, Analysis TSA proposes April 1 GRI in anticipation of 2013-14 contract talks Container shipping lines on the Asia-to-U.S. trade route want to maintain current rate gains as they approach the post-Lunar New Year shipping period and as 2013-14 contract negotiations begin in earnest. Member lines in the Transpacific Stabilization Agreement are recommending an across-the-board GRI on all dry and refrigerated cargo, effective April 1, 2013, in the amount of $400 per-FEU to the U.S. West Coast and $600 per-FEU to all other destinations. The TSA says freight rates remain below compensatory levels despite prior adjustments, and wants to ensure that 2013-14 contract rates contain meaningful net increases relative to 2012 contract levels. ���The week-long Lunar New Year factory closures in Asia tend to pull forward spring shipments, especially among retail customers,��� explained TSA executive administrator Brian M. Conrad. ���This translates into slowing cargo demand after the holidays, and is one of many such inflection points that can erode revenue throughout the year. Carriers are committed to keeping market rates stable over the next 6 to 8 weeks, as the contracting season ramps up.��� Contract negotiations are expected to ramp up in the coming weeks, and Conrad emphasized that while current market rates have shown improvement, another year of longer term rates at 2012 contract levels, or with only minimal increases, is not sustainable. China tops U.S. in global trade for 2012 China overtook the U.S. as the globe���s largest trading nation in 2012 for total imports and exports, according to official numbers from each country. U.S. imports and exports totaled $3.82 trillion last year, reports the U.S. Commerce Department, and China���s customs administration reported total trade in the amount of $3.87 trillion. ���For so many countries around the world, China is becoming rapidly the most important bilateral trade partner,��� said Jim O���Neill, chairman of Goldman Sachs���s asset management division, in a Bloomberg telephone interview. ���At this kind of pace by the end of the decade many European countries will be doing more individual trade with China than with bilateral partners in Europe.��� When including services, total 2012 U.S. trade went up to $493 trillion, according to the U.S. Bureau of Economic Analysis. The U.S. had a surplus in services of $195.3 billion last year and a goods deficit of more than $700 billion, according to BEA figures. China���s 2012 trade surplus, measured in goods, equaled $231.1 billion. The U.S. economy is approximately twice the size of China���s, according to the World Bank. In 2011, the U.S. gross domestic product topped $15 trillion while China���s was $7.3 trillion. Some economists from banks including UBS AG and Australia and New Zealand Banking Group recently questioned China���s export data when the customs administration reported an unanticipated 14.1 percent December export gain. China���s General Administration of Customs said the data was based on actual customs declarations. The U.S. remains the world���s largest importer, taking in $2.28 trillion in goods in 2012 compared with China���s import figure of $1.82 trillion. For more of the Bloomberg story: February 2013 Strong 2012 showing for California exporters California���s exported $161.7 billion in goods in 2012, exceeding 2011���s all-time record of $159.12 billion, according to an analysis of recent U.S. Commerce Department trade figures by Beacon Economics. Beacon officials were cautious about the numbers, however, noting that when adjusted for inflation, the figures actually represent a 0.4 decline year over year, and may even be revised further downward after a long-term examination of the accounting process, as happened in 2011. Jock O���Connell, Beacon���s international trade adviser, says the good news is that both years topped pre-recession export levels, and that it is likely that 2011 and 2012 export figures will end up in a virtual tie. California businesses exported $13.36 billion worth of goods in December 2012. Regarding imports, California took in $376.3 billion in goods last year, a rise of about 7 percent from $351.36 billion in 2011. For more of the San Luis Obispo Tribune story:

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