TWRA cuts Asian currencies surcharge

PUBLISHED : Wednesday, 26 August, 1998, 12:00am
UPDATED : Wednesday, 26 August, 1998, 12:00am

Lines in the Transpacific Westbound Rate Agreement (TWRA) will reduce currency adjustment factor (CAF) surcharges on container cargo bound for Japan, Taiwan and Singapore from ports in the United States and inland points for the quarter beginning on October 1.

TWRA, a rate-making group of seven ocean and intermodal carriers serving the trade between the US and Asia, said the lower surcharges reflected further weakening of Asian currencies against the US dollar.

The CAF on shipments to Japan will be reduced to 28 per cent from 33 per cent, while the CAF on cargo bound for Taiwan will be lowered to 3 per cent, from 5 per cent. The Singapore CAF will be cut to 9 per cent from 11 per cent.

A Korean CAF, already at zero in accordance with TWRA's calculation formula, will remain suspended in the coming quarter.

TWRA's fuel adjustment factor (FAF) surcharge, applicable to all shipments carried on TWRA vessels from the US to Asia, will remain at US$40 per 40-foot and 45 ft container; $32 per 20 ft container; $20 each for motor vehicles; $4 per 1,000 board feet for lumber; and $2 per revenue ton for other cargo.

CAFs are special surcharges, broken out from freight rates, that are designed to fluctuate with exchange rates and help offset high currency costs in Asia outside carriers' control.

FAFs fluctuate with prices of marine fuel at key trans-Pacific loading points. They are designed to help offset extraordinary fuel expenses.