SHIPPING RATES DO SLOW FIZZ IN WINE AND SPIRITS TRADE

SHIPPING RATES DO SLOW FIZZ IN WINE AND SPIRITS TRADE

Shipping rates for wines and spirits have stayed steady for the past two years. And shippers doubt the cork will pop any time soon on big increases in the trade.

"We don't expect increases to be much more than last year," said Geoffrey Giovanetti, managing director of the Wine and Spirits Association in Reston, Va.It now costs between $1,900 and $2,100 to ship the equivalent of a 20-foot container between the United States and the European continent over lines that are part of the Trans-Atlantic Conference Agreement, the carrier association that collectively sets rates for its lines in the trade.

That's about a 4.5 percent increase over last year's rates. Most of the increase was due to currency adjustment surcharges.

The conference had imposed higher rates, but agreed to cut the increase in a deal with the Federal Maritime Commission, which agreed to drop its investigation into TACA's pricing practices. Shippers complained that the conference lines had increased their rates too soon and too much, while cutting back service.

So the lines cut out the increase in the base rates, keeping in currency adjustment and other surcharges. However, line executives said they'll likely try to install the same increases in 1996 that they lost this year.

Wine and spirits shippers probably won't bear the full brunt of those increases, which could range up to $120 for a 20-foot container and $160 for a 40-foot box. As higher-volume shippers on the trade, importers of wine, spirits and beer have enjoyed lower rates than those of some other commodities, especially in the North Atlantic, where those imports rank in the top five annually, according to figures released by Port Import/Export Reporting Service, or PIERS, a unit of The Journal of Commerce.

For example, Heineken's rate increase before the rollback amounted to only about $20 on a 20-foot box and $15 on a 40-foot container, according to contracts filed with the FMC. That's about a 2 percent saving.

Guinness PLC, another top importer of wine, spirits and beer, saved about 3 percent from the rate increase it would have had if the deal had not been made between TACA and the FMC.

The higher volume of imports for wine, spirits and beer also attracts more competition among the steamship lines. Independent lines - those who are not members of TACA - have been making some strong inroads into the market.

Evergreen Marine Corp. landed a large account for Heineken USA, generally considered the plumb of alcohol importers. But the largest volume of containers of Heineken so far this year have gone through Chester, Pa., on vessels belonging to Independent Container Line, another independent carrier. Other importers said they are negotiating with Independent Container Line, too. Lykes Bros. Steamship Line also garners its fair share of the contracts for the imports.

There will be a new wrinkle to wine and spirit shipping contracts in 1996. As part of its deal with FMC, TACA agreed to allow each of the individual lines to negotiate separately with each individual shipper. Previously, other lines had to agree to deals between member carriers and shippers.

This will allow carriers and shippers to tailor contracts to the needs of shippers and carriers for pricing and service. It also should make it possible for the two to develop longer-standing relationships that some shippers said have been pre-empted by the conference setup.

Mr. Giovanetti said, "Personally, it looks like the individual contracts with the individual lines may be the way to go. It certainly will be worth trying."