NEDLLOYD SEES CONFERENCES' EFFECT WEAKENING RATES TERMED UNACCEPTABLE IN SOME TRADES

NEDLLOYD SEES CONFERENCES' EFFECT WEAKENING RATES TERMED UNACCEPTABLE IN SOME TRADES

The stabilizing influence of shipping conferences that set tariffs for member lines is declining, the Dutch shipping and transportation company Royal Nedlloyd Group NV claimed in its annual report published Monday.

This is adding to the downward pressure on freight rates on a number of key routes, according to Nedlloyd. In particular, the cost of shipping cargoes between Europe and North America has fallen to "an unacceptably low" level

because of strong competition, while 1990 is forecast to be another poor year for the trans-Atlantic trades.Rates also were down sharply in the Europe-Far East trades, despite an increase in cargo volumes. This weakened the result of ScanDutch, the shipping consortium in which Nedlloyd is a member, the company disclosed.

The Dutch shipping line also was critical of the European Commission's refusal to recognize consortia as being of equal standing to conferences.

This status "would give shipowners the necessary legal security and strengthen their position in the competitive struggle taking place worldwide," Nedlloyd asserted in the annual report.

The Dutch company reported last month a rise in net profit to 252.3 million guilders in 1989 from 153.6 million guilders in 1988. However, the operating result of ocean shipping was almost unchanged at 111.3 million guilders, reflecting not only tough competition and increased charter rates but also higher fuel prices and restructuring costs.

Nedlloyd forecast that the 1990 result for its ocean shipping division would be below the 1989 level, partly because of adverse currency movements, but said prospects generally for ocean shipping were positive.

The company drew attention to the lack of progress during the year on the development of a European shipping policy, and said the long-awaited proposal for the European Community ship register was disappointing. The proposed measures are aimed more at harmonizing the cost levels between EC member states themselves than at any reduction in costs, and in its present form Euros would increase costs for Dutch shipowners, according to Nedlloyd.