Matson Raises Fuel Surcharge For Micronesia Shipping

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Company defends move as fuel cost continue to rise

By Gaynor Dumat-ol Daleno

HAGÅTÑA, Guam (Pacific Daily News, May 12, 2014) – The sole ocean carrier that transports goods from the West Coast to Guam is raising its fuel surcharge for Guam, the Northern Marianas and the rest of its stops in Micronesia by 1.5 percentage points, to 43 percent, starting June 8.

"Since announcing our last increase, which became effective March 23, 2014, Matson's fuel costs have continued to rise," said Dave Hoppes, Matson's senior vice president for ocean services. "A major contributor to our increase in fuel consumption has been a number of additional vessel sailings necessary to meet the service requirements of our customers."

Matson remains the only U.S. ocean carrier serving Guam since Horizon Lines pulled out a few years ago. More than 80 percent of Guam's consumer goods are brought in by sea, so an increase in fuel surcharge has had an impact on the prices of items at island stores.

Extra voyages also added to the higher costs Matson is experiencing because of the Emission Control Area regulations, which became effective in August 2012, according to the company.

On May 6, Matson reported a net income of $3.4 million for the first quarter this year. During the same period last year, its net income was $9.1 million.

On a year-over-year basis, Hawaii container volume decreased 2.9 percent, due primarily to lower eastbound freight, but Matson's container volume for its Guam segment increased 3.4 percent, the company stated in its first quarter earnings report.

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