Shippers add 1.75%
fuel surcharge

They say the increase is
to offset rising oil prices

By Peter Wagner
Star-Bulletin

Sea-Land Services and Matson Navigation Co. plan to add a 1.75 percent fuel surcharge to the cost of shipping cargo between the West Coast and Hawaii and Guam, a response to rising fuel prices this summer.

The new fees, which both go into effect Oct. 11, will add about $14 to the cost of shipping a car to Hawaii from the West Coast.

"To date, Matson has been absorbing the increases in fuel costs, in hopes that the trend of rising prices would abate," said Paul E. Stevens, senior vice president of marketing at Matson.

Matson said the fee will offset rising bunker fuel prices and the increased cost of shipping goods over land by truck and other carriers.

"As anyone who drives a car is well aware, fuel oil prices have been rising rapidly in recent months," said Stevens, noting bunker fuel prices have gone up 40 percent since May.

Company spokesman Jeff Hull said the fee will raise the cost of shipping a car from the mainland to $830 from $816.

Hull noted the surcharge is pegged to the price of oil and could go up, down, or be eliminated, according to fuel price trends.

Sea-Land spokesman Marv Buchanan said fuel the company's last fuel surcharge, a 1 percent fee, went in to effect March 15 and was eliminated Sept. 13 last year. Stevens said trucking companies began adding fuel surcharges of one to two percent to their bills this summer, a cost Matson has been absorbing.

The cost of shipping goods from the West Coast has been steadily rising in recent years, with rate increases often going into effect early each year. Matson in February instituted a 2.5 percent rate hike, following a 3.5 percent hike in February of 1997.