Package delivery company FedEx Corp has lowered its rates in the fiercely competitive Chinese market despite higher fuel prices.

FedEx, which started its domestic shipping service in China last June, cut charges for its quickest service, FedEx First Overnight -- which guarantees delivery before 10:30 a.m. the next day -- by as much as 77 percent.

Its new prices for sending a 2-kg parcel from Beijing to Shanghai via First Overnight scheme is 31 yuan, or about a third of the 90 yuan charged by EMS, a state-owned courier agent.

"By offering the new rates to the market, we aim to provide more customers with access to our reliable services so that they can optimize their supply chains," a FedEx spokeswoman said in an e-mailed statement.

Beijing raised nationwide retail diesel and gasoline prices by nearly 20 percent last month, the biggest one-off rise ever, and analysts expect more increases in coming months as fuel prices in China are still well below global market levels.

FedEx reported a fiscal fourth-quarter loss of $241 million, or 78 cents a share in June, citing record high fuel prices and a weak U.S. economy. It gave no details about its performance in China. ($=6.86 yuan)