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FedEx Raises Shipping Rates for Express, Ground and Freight Services

Shipping rates for FedEx Express, FedEx Ground and FedEx Freight will increase effective Jan. 7, following rate hikes at the U.S. Postal Service (USPS) and other shippers, parent company FedEx Corp. announced Monday.

FedEx Ground and FedEx Home Delivery shipping rates will increase by an average of 4.9 percent. FedEx Express shipping rates also will go up by an average of 4.9 percent for U.S. domestic, export and import services.

FedEx Freight shipping rates will increase by an average of 5.9 percent. This rate change applies to eligible FedEx Freight shipments within the U.S., including Alaska, Hawaii, Puerto Rico and the U.S. Virgin Islands, between the contiguous U.S. and Canada, within Canada, between the contiguous U.S. and Mexico, and within Mexico.

The company did not offer an explanation for the hikes, but transportation companies are dealing with high fuel costs and preparing for further increases. For the third quarter ended Aug. 31, FedEx Corp. reported net income rose 40 percent, to $835 million, on revenue that grew 11.8 percent, to $17.1 billion.

USPS has filed notice with the Postal Regulatory Commission for price increases to take effect Jan. 27. The proposed prices would raise mailing services product prices roughly 2.5 percent, while bumps for shipping services prices vary by product. The increases range from 70 cents to $1.05 per parcel, depending on package size.

USPS noted its Priority Mail Express will increase 3.9 percent and Priority Mail will go up 5.9 percent. Although price increases for mailing services are based on the Consumer Price Index, shipping services prices are primarily adjusted according to market conditions. The postal service said these new rates will keep it competitive, while at the same time provide the agency with needed revenue.

UPS recently instituted a ground fuel surcharge increase of 0.25 percent based on the national U.S. average on highway diesel fuel price and adjusted weekly. Effective Oct. 15, the international air-import fuel surcharge increased 0.5 percent. These surcharges will continue to be based on the national average U.S. Gulf Coast jet fuel price and adjusted weekly. Ocean carriers recently imposed fuel surcharges as well.