Postal Update: Rate increases, Product changes

White packaging material for shipping goods

The USPS has approved a temporary rate increase for packages. In previous years, this was a “seasonal pricing increase” but this year it begins on October 2nd, and continues through January 22, 2023, the day before the next overall rate increase. This price increase will affect prices on the following commercial and retail domestic competitive parcels: Priority Mail Express (PME), Priority Mail (PM), First-Class Package Service (FCPS), Parcel Select and USPS Retail Ground. Priority Mail Flat rates are rising between 4.4% and 10.6%. The Postal Rate Commission ruled on this proposal on September 8th.

The USPS has proposed a Classification change moving Retail Ground and Parcel Select Ground from their competitive products to First Class Package Services, which is considered market dominant. This allows the USPS to streamline their products, increase weight limits and insurance coverage and add cubic pricing tiers. There would continue to be retail and commercial price categories.  This comes after the June USPS proposal to change the delivery standards for these products from 2-8 days to 2-5 days. It is expected these changes, if approved, would be put into place with the rate case on January 23, 2023.

In addition, the USPS has confirmed that postal rates will increase again on January 23, 2023. The maximum available rate authority will be calculated in September, but the last update on August 10th was between 3.514% and 3.576% overall.