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                                                    RATE BULLETIN

OCTOBER 2007

Dear Transportation Customer:

Major water carriers serving Alaska have filed for a General Rate Increase with the Surface Transportation Board.  A 6.0% General Rate Increase will apply to virtually all commodities moving to and from Alaska and will become effective on or about December 2, 2007.  In addition, Port Security fees on the steamship lines will increase by about ten percent.

Based on the above, Alaska Traffic Company will implement a simple 6.0% general rate increase on all commodities effective December 2, 2007.

This filing is in keeping with the carriers’ plans to file only one general rate increase each year.

With the exception of local Seattle area pickup carriers, nearly all motor carriers implemented rate increases earlier this year.  If your rates include inbound costs other than local Seattle area pickup, that portion of the rate will not change in most cases.

As you may have noticed, fuel surcharges have increased again recently.  We will continue to raise or lower these surcharges when the ocean carriers do so and to notify you with your invoices and on our website at www.alaskatraffic.com.

If applicable, your revised rate schedule will be sent as soon as possible.  Please review it carefully and let us know if you have questions.  Thank you once again for your business.  We look forward to serving you in the future.

Sincerely,

Nicholas A. Lohman

Alaska Traffic Company