Port of Houston Raises Tariffs

Source: JOC

Container costs to rise 3 percent, breakbulk fees to grow 2 percent

Commissioners at the Port of Houston voted yesterday to increase the port’s tariff by 3 percent for containers and 2 percent for breakbulk and project cargo despite the protests of carriers and port stakeholders.

Representatives from global container carriers Mediterranean Shipping Company, Zim Lines and Hapag-Lloyd asked the port commission to delay the tariff increase. Salvatore Bruno, senior vice president with Hapag-Lloyd for the Gulf Pacific area, said the carrier’s losses over the last two years have been the highest in its 200-year history. To cut costs, John Edel, Gulf region vice president for Zim Lines, said that Zim has cut staff and laid up vessels and is no longer operating a direct call to Asia out of the Gulf.

During the first half of 2009, Hapag-Lloyd reported losses of $662 million, while Zim reported losses of $302 million. MSC is privately owned and does not make its finances public. All of the carriers said that they are struggling and asked the port to delay the tariff increase, according to a recording of the meeting made by and available online at Guidry News Service.

The Port of Houston predicts that operating costs will increase by about $8 million during 2010, or more than 8 percent on container operations and 8.7 percent on general cargo operations. Executive Director Alec Dreyer said this will be due to increases in fuel, labor, security and infrastructure costs, according to local news sources. Despite the tariff increase, the port will be absorbing most of these new costs and Houston’s tariff will be one of the lowest at a major U.S. port, he said.