Nothing out of the box from China trade in 09

The southbound volume downturn that has driven two major service consolidations so far this year shows no significant sign of reversing and carriers’ commitments to reduced capacity have now been extended from the end of June until at least the middle of August.
It was the AAUS group of APL, Hamburg Sud, Hapag-Lloyd and Hyundai Merchant Marine that was first to scale back operations, announcing in late January it would suspend one of two loops on the North & East Asia-Australia route with immediate effect and withdraw three ships.
The standalone southern string (AAS) was mothballed until at least June and instead the group now operates a combined northern and southern service with 6 x average 3,600 TEU vessels on a 42-day rotation.
Port roster is now Melbourne, Sydney, Brisbane, Kaohsiung, Busan, Qingdao, Shanghai, Ningbo, Kaohsiung, Yantian, Hong Kong, Melbourne.
This meant the cessation of direct calls to Japanese ports but Hamburg Sud is covering the Japanese market by taking slots on Maersk’s Boomerang service between Melbourne/Sydney/Brisbane and Yokohama/Osaka. The two-string service had only been implemented in the last quarter of 2008.
Cancelled
The revised service utilises the 3,534teu sisters APL Bangkok, APL Sydney and Cap Manuel, the Hyundai-operated, 3,502teu APL Ruby, Evergreen’s 3,459teu Ital Fortuna and Hapag-Lloyd’s 4,112teu Glasgow Express), and this fleet has proven “quite adequate in the circumstances”, according to consortium sources.
“We’ve extended the single string arrangement until mid-August,” one executive said, “but that decision is subject to quick review if circumstances change.
“All lines are being sufficiently cautious – because there have been no real fundamental changes since the downturn first became undeniable early in the year.”
On the same route the rival ACE group (CSCL, OOCL with ANL taking slots) cancelled three successive round voyages from early February, affecting the 4,250teu sisters CSCL Qingdao, CSCL Dalian and OOCL Yokohama, due to a downturn in bookings.
The lines temporarily adjusted the complementary ANL-lead AANA (also CSCL and OOCL) service to include northbound calls at Kaohsiung; the NEAX (K Line, MOL, NYK) and SAS/ACX (Cosco/PIL) services skipped a number of port calls during January/February and the latter’s Da He was not replaced while drydocking for one round voyage.
A more comprehensive reduction occurred in early May when AANA and NEAX announced they would join forces to operate a combined string, saving four vessels but maintaining a wide spread of weekly port calls in Japan, Korea, China, Taiwan and Australia by extending round voyage times from 35 to 42 days.
The full rotation is Melbourne, Sydney, Brisbane, Yokohama, Nagoya, Osaka, Pusan, Qingdao, Shanghai, Ningbo, Hong Kong, Kaohsiung, Melbourne.
As a consequence the four surplus vessels – NEAX’s Sophia Britannia and MOL Encore and AANA’s ANL Wyong and initially OOCL Panama (later swapped with CSCL Melbourne) were put into hot lay-up, although ANL took the opportunity to send ANL Wyong to its builder for guarantee work.
Rotation
Cosco, which has a slot-swap agreement with the Japanese carriers covering the weekly SAS service and NEAX, made associated changes by switching two of its Chinese calls, from Qingdao and Ningbo to Shekou and Nansha.
The initial cooperation agreement was for six weeks (the period of full fleet rotation) and with the arrival of NYK’s Kaga in Japan on its current voyage a new rotation begins; again, consortium sources said renewal of the agreement was ‘highly likely’, taking this rationalisation also to mid-August.
The North & East Asia trade has suffered one casualty, in the form of South Korea’s Heung-A, whose withdrawal from the CKA service (with Hanjin, STX Pan Ocean and Sinolines) was just about to take effect.
There will be no capacity cut, however, as Sinolines has taken over Heung-A’s rights and is replacing the 1,713teu Ocean Arrow with the 1,740teu Matthias Claudius.
Container trade between India and Australia appears to have suffered less of a decline, although authoritative figures are, as usual, hard to come by as most cargo in each direction is relayed over Singapore or other south-east Asian ports.
The only direct link between Australia and India is provided by CMA CGM’s New NEMO service, northbound only.
Sources say the Chennai direct call is more about India-Europe than Australia-India, simply because Australian shippers have such a multiplicity of well-established relay options.