Box lines look for new partners when they target profitable routes

In order to develop more lucrative trade routes, shipping companies are looking for ship-sharing partners outside of their main East-West alliances.

And with their services under financial pressure, container lines are shifting their tonnage to routes they believe can still make money, whether on an individual basis, by sharing vessels, or by buying slots initially.

In return, the airlines will try to limit their exposure to east-west routes, which are heavily exposed to the volatile spot market.

However, it is unlikely that shipping companies will keep shippers on new routes in the long term without operating their own tonnage, as the lack of operational control creates a commercial disadvantage that other operators can exploit.

But with shipping alliances reeling from the demise of the 2M line — it’s increasingly looking like that will happen sooner than the official end-of-2024 expiry date — in the meantime, shipping lines are looking for new, financially strong shipping lines to work with on other trades.

Indeed, next month Ocean Alliance member Cosco Shipping and subsidiary OOCL are launching a weekly Europe-East Coast-South America service with THE Alliance member ONE, allowing the Japanese shipping company to break into a trading territory where it has not previously had a presence.

The first voyage, referred to as the ESE2/EEX/LUX service by Cosco, OOCL and ONE, will take place on September 16 from Montevideo with the Cosco-operated, 2003-built 4,051 TEU Xin Nan tong. The full rotation will be: Rotterdam-London Gateway-Hamburg-Antwerp-Lisbon-Algeciras-Santos-Paranagua-Montevideo-Buenos Aires-Itapoa-Paranagua-Santos-Rio De Janeiro-Algeciras-Rotterdam.

According to Alphaliner, the schedules for the new service confirm Cosco and OOCL as ship operators, with ONE not yet having to provide tonnage for the eight-ship ring.

The three airlines are all targeting high-yield, time-sensitive refrigerated cargo from South America to Europe, which is clearly underserved by the existing services, which include Cosco and its tonnage collaboration with Hapag-Lloyd and CMA CGM, in their respective SWX/Eurosal XL/EWX offerings.

“South America has always been of strategic importance to our global network,” said ONE Managing Director Yu Kurimoto, adding that the new service represents “a significant step in meeting the needs of our customers in this important region.”

Meanwhile, Cosco claimed that the service’s “fastest” transit time of 12 days between Algeciras and Santos would allow for “more precise” delivery of products to Europe. And OOCL pointed out the “attractive transit time” of 16 days from Rio de Janeiro to Rotterdam.

Alphaliner added that the two stops in Algeriras would allow transshipment to other Mediterranean ports, noting that the new service is the first direct connection between Lisbon, Portugal and the South American east coast.

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