Small Lines Steal Transpacific Show

Smaller container shipping lines are showing up the big players by going fully loaded on the transpacific route in the peak season. Four new services have been launched in recent months and two more are on the launch pad.
The reason for the success of the smaller lines, say analysts, is the operation of a direct service from Asia to the US West Coast and the deploying of smaller vessels ranging between 2,000 and 5,000 TEUs, which offer faster transit and turnaround times by sailing at full speed.
With the big players – carriers such as Maersk, CMA CGM and MSC – slow steaming from Asia to the US West Coast, shippers are showing been interest in the shorter, and cheaper, voyages being offered by the smaller operators.
“We have seen rates increase on all trades, but volumes are not meeting the earlier expected levels,” said a shipper.
“So for the shipping line customer, transit times and costs are important, and in an uncertain market the small line can address that concern far more easily than the big names.”
The four new services lauched are by China state-owned shipping line Hainan Pan Ocean Shipping; The Containership Co (TCC), established in Norway as an over-the-counter concern on the Oslo Stock Exchange; and US Jones Act operator Matson Navigation Co.
Hainan Pan Ocean Shipping Co is entering the China-US market with a new service connecting Ningbo and Shanghai to Long Beach. The services, called Central China-America West Coast Express (CAE), will deploy four chartered ships of 2,500 TEUs each on the route.
The services will call at the Pacific Container Terminal (SSA-Cosco) at Long Beach and offers onward carriage to inland points in Chicago and Houston.
Hainan Pan Ocean Shipping was established in 2008 by Captain Li Kelin, the former president of CSCL and vice-president of Cosco, and is backed by the Hainan government and Yangpu port.
TCC’s Great Dragon Service was launched on April 17 and operates a weekly schedule shutting between the Chinese port of Taicang, Jiangsu province, which neighbours Shanghai, and Los Angeles-Long Beach. The port-to-port service initially deployed vessels of 2,500 and 2,800 TEUs on the route and last month upgraded to 3,000 TEUs vessels.
Matson Navigation Company is adding a second string of five time-chartered 3,500 TEU vessels to its China-Long Beach Express. Matson began a China service in 2006 with its initial CLX string. The new string begin later this month and will be in “full deployment” by early October.
Ports calls will be Hong Kong, Shenzhen and Shanghai to Long Beach. Matson operates a weekly service from Xiamen, Ningbo and Shanghai to Long Beach.
However, while these three lines look set for a long-term future on what is the world’s largest container trade lane, Cosco Container Lines (Coscon) has confirmed it intends to withdraw its transpacific peak season services, know as CES, which was launched in June, by this month, two months earlier than planned. The CES service covers Shanghai, Fuqing, Xiamen and Long Beaach.
The decision came as a surprise to the industry but Coscon claimed that market demand had not reached the levels earlier expected.

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