SHIPPING LINES INCREASE RATES AS COSTS SOAR


As rising operation costs eat into returns, shipping lines have increased freight rates for cargo shipped into the region from India, a move that is likely to push importers into passing on increasing costs to consumers.



Emirates Shipping Line (ESL), Mediterranean Shipping Company (MSC), French carrier CMA CGM, and Mitsui OSK Lines (MOL) have adjusted their charges up to $300 per a Twenty-Foot Equivalent Unit (TEU) shipped from Asia to East Africa.



TEU is the standard unit for counting containers of various capacities and for describing the capacities of container ships or terminals.


“The economic crisis... requires extraordinary measures,” stated Emirates Shipping Line press statement.



Experts say the high cost operations in the region could complicate matters for Emirates shipping line that had pulled out of highly competitive markets like the US due to low business occasioned by global downturn. ESL ships now call at the State-owned Jaya Container Terminal and it uses Colombo Port as a hub to service its markets in the Far East, India, the Middle East and East Africa. ESL, founded in 2006, continues to see opportunities in the Middle East, the Indian Subcontinent and Africa regions, which have not witnessed a severe volume crunch.



The shipping line plans to introduce more vessels on the route between Jebel Ali and East Africa hoping to boost its market share.Mediterranean Shipping Co., Emirates Shipping Line and CMA CGM effected the increase the rates on February 17th, while MOL implemented the new charges last Saturday.



Other African sector shipping Lines including the African Shipping Line based in Dubai, UAE have either re-adjusted their prices or are considering a way forward, agencies describe.