Hapag-Lloyd AG, Evergreen Marine Corp (長榮海運) and nine other companies have selected new top officials from four of their Asia-based members to lead a group of shipping lines that move cargo to the US from Asia.
Chief executive officers from APL Ltd, Evergreen Marine, Hanjin Shipping Co and Nippon Yusen K.K. will lead the 11- member Transpacific Stabilization Agreement starting on Dec. 1, the group said in an e-mailed statement yesterday.
Albert Pierce, who has served as the group's executive director since 1999, will retire on Jan. 1.
The latest management change will facilitate the response of the group, which accounts for about 70 percent of trade between the US and Asia, to market conditions. Sea carriers, including A.P. Moeller-Maersk A/S and Neptune Orient Lines Ltd, have seen rates decline as a record number of vessels are delivered. Rising costs of inland transport and fuel are also crimping profits of shipping lines, offsetting gains from expanded global trade.
"This new management structure puts us in a much better position to respond to changing market conditions, customer needs as well as the needs of the carriers,'' Ronald Widdows of APL, who will serve as the executive committee chairman next year, said in the statement.
The Westbound Transpacific Stabilization Agreement, which counts 11 shipping lines as mem-bers, has one executive director, the same structure as the Trans-pacific Stabilization Agreement before the latest management changes. The Westbound group moves cargo to Asia from the US.
Brian Conrad, deputy executive director of the Transpacific Stabilization Agreement, will remain in charge of administrative functions, the group said in the statement.
In the next four to five years, demand for sea transport may grow around 9 percent to 10 percent per annum, Philip Damas, research director at London-based Drewry Shipping Consultants Ltd, said on Friday.
"We are forecasting late 2008 will be when rates will recover," Damas said.
Next year, "there won't be a sharp reduction in rate because volume is strong," he said.
Rates may fall about 2 percent to 3 percent next year, compared with an estimated drop of 7 percent to 8 percent this year, Damas said.
The IMF forecasts global trade to grow 8.9 percent this year and 7.6 percent next year.
Falling rates and higher fuel costs have caused shipping lines including Evergreen and Neptune Orient, which owns APL, to report smaller profits in the first nine months of this year.
Other members of the Transpacific Stabilization Agreement include Cosco Container Lines Ltd, South Korea's Hyundai Merchant Marine Co, Japan's Kawasaki Kisen Kaisha Ltd, Mitsui O.S.K. Lines Ltd, Orient Overseas Container Lines Inc (