Gas prices are still going up, but the fuel surcharge added to the cost of shipping goods to Hawaii is going down.
Matson Navigation Co., the state’s largest ocean cargo transportation firm, announced Thursday that it will cut its fuel surcharge by 3 percentage points, from 45.5 percent to 42.5 percent, on its Hawaii service effective Sunday.
The reduction equates to a savings of $90 to $150 per container, and is the second decrease in as many months.
FUEL COSTS DROPPING
Matson Navigation Co. announced Thursday it was lowering its fuel surcharge for the second time this year:
| Feb. 4, 2008 |
31.5% |
| April 6, 2008 |
33.75% |
| July 13, 2008 |
38.25% |
| Aug. 31, 2008 |
42.25% |
| Sept. 21, 2008 |
37.50% |
| Oct. 12, 2008 |
33.0% |
| Oct. 19, 2008 |
27.0% |
| Nov. 2, 2008 |
25.0% |
| Nov. 16, 2008 |
19.5% |
| Nov. 30, 2008 |
15.0% |
| May 24, 2009 |
16.5% |
| June 21, 2009 |
20.0% |
| July 5, 2009 |
28.0% |
| Oct. 4, 2009 |
24.0% |
| Feb. 7, 2010 |
27.5% |
| July 18, 2010 |
25.5% |
| Sept. 12, 2010 |
21.75% |
| Feb. 27, 2011 |
26.5% |
| March 27, 2011 |
35.0% |
| May 1, 2011 |
43.5% |
| June 12, 2011 |
47.5% |
| Aug. 28, 2011 |
45.5% |
| Sept. 25, 2011 |
42.5% |
Source: Matson Navigation Co.
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In August, Matson reduced its fuel surcharge by 2 percentage points.
Two consecutive decreases is welcome news for Hawaii businesses and consumers, though the surcharge remains not too far below the record high of 47.5 percent in effect from June 12 to Aug. 27. The last time the surcharge was below 40 percent was in April.
Matson, which also reduced its fuel surcharge by 3 percentage points on service to Guam, Micronesia and the Commonwealth of the Northern Mariana Islands, said the move was made in response to drops in the price of bunker fuel powering its fleet.
"We are encouraged by the recent moderation of bunker fuel costs, allowing us to make this second decrease," Dave Hoppes, senior vice president of ocean services for Matson, said in a statement.
Hoppes said Matson’s practice is to pass on fuel cost reductions to customers as soon as possible, while giving 30 days’ notice for increases.
"Sustained high fuel prices have made 2011 a very challenging year for many businesses," he said. "We will continue to monitor fuel costs and adjust the surcharge accordingly."
Typically, other ocean cargo carriers serving Hawaii — Horizon Lines, Pasha Hawaii Transport Lines and Young Bros. — reduce fuel surcharges after Matson, making the change industrywide.
Rich Meachen, president and owner of wholesale paper product distributor PaperSource Hawaii, had been expecting the move by Matson sooner, and said it will have far-reaching effects as suppliers pass on savings.
"It does affect everything coming into the islands," said Meachen, whose annual ocean freight bill is about $1.8 million. "It reduces costs. That will eventually trickle down to the end user."
The trickle-down effect can lag Matson’s move, as distributors and merchants adjust prices after using up inventory that was shipped at the higher price. But the degree to which end users might feel the benefit often ranges from small to undetectable.
For instance, the fuel surcharge reduction equates to 1 cent on a six-pack of soda or 3 cents on a 20-pound bag of rice.
Unfortunately for consumers, what little benefits are realized from lower shipping costs are being offset to some extent by gas prices.
The statewide average for regular unleaded gas this week was $4.22 a gallon, up 3 cents from last week. The average in Honolulu was up 4 cents to $4.12, which is 14 cents higher than a month ago.
Prices for crude oil that affect gas don’t always move in tandem with the bunker fuel used by Matson ships. But there is some hope gas prices are headed down. AAA-Hawaii on Thursday said declines in crude oil prices, oil demand projections and the stock market might exert downward pressure on pump prices.
