Pacific shipping companies feel heat of peak fuel
Operating margins of shipping companies around the Pacific are under increasing pressure as fuel prices reach the highs of the 2008 oil crisis.<!--more-->The steady rise in the past few weeks has been attributed to the worsening political situation in oil producing nations in the Middle East. While some shipping firms have so far been biting the bullet and avoiding increasing their freight tariffs, others have already done so as many as three times this year.
Matson Navigation and Horizon Lines, both serving the Western and Northern Pacific Islands, connecting them to Hawaii and the US West Coast, announced last week that they were putting up their freight tariffs by as much as 36 to 45 percent.
Freight movements in Guam, the Commonwealth of the Northern Marianas and the Federated States of Micronesia depend on these shipping companies. Their economies are already reeling after the Japanese disaster with a sharp decline in arrivals from their biggest tourism market (see next item).
Meanwhile, some companies are trying hard to keep freight rates unchanged. Fiji based Carpenters Shipping General Manager Manickam Narain told Pacific Periscope though fuel prices were volatile, the company that serves Fiji, Papua New Guinea and the Pacific Rim countries had avoided price hikes, instead concentrating on smarter bunkering and other operational rationalisations.