shipping alliance

The new shipping alliances are in place. How are they impacting?

The changes in shipping alliances recently put in place have have already had a big impact on European ports. Coming into effect on April 1st, shippers have experienced significant changes in their carriers’ service networks. On the trans-Pacific trade alone, the alliances will offer 18% fewer direct routes and 33% of the routes will have transit times that are shorter or longer by three or more days compared to the member carriers’ alliance offerings before April.

Rotterdam is feeling the change the most. According to CargoSmart, the Hong Kong based shipment services provider, Rotterdams services from the alliances have fallen by 3 to 23, but the number of vessels passing through and being deployed has increased by 30.  Southampton, Antwerp and Hamburg have also seen the number of deployed vessels increase by 18, 16 and 13 respectively.

Felixstowe have seen a decrease in services through the port by 21, and Bremerhaven by 17.  Bremerhaven has also seen the average vessel capacity rocket by 1000 ten, and Southampton and Le Have have both seen capacity jump by 1200 teu.

Hamburg Port Authority chief executive Axel Mattern, speaking to Container Shipping & Trade said that berth availability and hinterland connections are “key factors” when it comes to dealing with the new alliances and their services. “The challenges with the big ships are on the navigational side. You need to be able to cope with the volumes which are being churned out from all of these big ships. Facilities need to handle all these volumes in a very limited time frame. They are not designed for the storage of containers. They are designed for perfect handling. That is the challenge. You need the capability to enable the volumes to flow.”

According to the Wall Street Journal, American farmers are concerned that the restructuring will make it far harder for them to deliver US commodities abroad. Port calls have been falling since before the new alliances formed, though. Sailings to U.S. ports from Asia recently were running at a weekly rate of 57, down from 65 four years ago, according to Alphaliner, which tracks such activity. However, with larger vessels coming into use, overall capacity has risen 4% to the U.S. West Coast and 22% to the East Coast in that same period, the data show.

With the alliances only having been in place for less than 3 months, the full impact is yet to be seen. Vessels into ports and numbers of containers are bound to fluctuate whilst the alliances find their feet, but with less capacity and demand always changing, it will be interesting to see how the changes affect the ports long term.