Trading Conditions Result in Restructure of MSC Portfolio
EUROPE – SOUTH AMERICA – In view of the current trading conditions, container shipping line MSCMediterranean Shipping Company S.A. says it will be restructuring the group’s North Europe to South America East Coast freight services and effective from mid-April will be providing the following two services:-
1) NWC/SAEC I (Brazil loop) will be operated with 7 x 5700 TEU vessels on the following port rotation: Antwerp – Rotterdam – Hamburg – Bremerhaven - Le Havre – Sines – Rio de Janeiro – Santos – Navegantes – Santos - Rio de Janeiro – Salvador – Anwterp. The first sailing will be the MSC Barcelona 416 (ETA Antwerp April 15th)
2) NWC/SAEC II (Plata loop) will be operated with 8 x 9800 TEU vessels on the following rotation: Rotterdam – London Gateway – Hamburg – Antwerp – Le Havre – Itaguai – Santos – Paranaguá – Buenos Aires – Montevideo – Rio Grande – Itapoa – Paranaguá – Santos – Rotterdam.
The first sailing will be the Cap San Agustin 417 (ETA Rotterdam April 16th) MSC says that the new services will provide for more efficient vessel operations in response to the current trading environment.
South America service shake-up will cut container capacity
Cutbacks and cancellations spell a double-digit decline in trade lane’s annual space
Last week, CMA CGM, Compania Sud Americana de Vapores and Mediterranean Shipping Co announced they would terminate their Europe to east coast South America Brazil Express/Safran Brazil String, which was run using seven vessels with an average capacity of 4,099 teu.
CMA CGM will continue to offer services on the trade lane through its joint service with Marfret, through a slot-charter agreement on an MSC service, where it will also become a vessel provider, and a Hamburg Süd service, which was recently upgraded to an average vessel size of 9,800 teu.
MSC will continue to operate its weekly Brazil loop and also take space on the Hamburg Süd service.
CSAV will take slots on the Hamburg Süd and MSC services.
The axing of the CMA CGM, CSAV, MSC joint service and the upgrading of vessels on the Hamburg Süd service will reduce total annual capacity on the services, some of which also call in the Mediterranean, by 11.1% to 1.4m teu, according to Lloyd’s List Intelligence data.
Shipping lines on the trade lane have been under pressure over the last year because of falling rates and a lack of volume growth in the northbound direction.
Container Trades Statistics’ dry box price index for the east coast of South America to northern Europe trade lane, which uses the average price in 2008 as an index level of 100, declined to 107 points in January 2014, compared with 121 points a year earlier.
For reefer containers, the index slipped to 94 points in January compared with 111 points a year earlier.
In the northbound direction, the index for dry containers has declined from 83 points in January 2013 to 72 points in January this year.
The reefer box index has slipped from 102 points in January last year to 101 points this year.
The freight rate declines come as the trade lane has suffered a reverse in its headhaul direction during the past two years.
In 2011, volumes from the east coast of South America to northern Europe led the way with 602,198 teu transported, compared with 570,070 teu southbound.
Last year, as a result of weak demand in Europe for South American products, volumes from South America to northern Europe had declined to 544,914 teu, a 9.5% slip compared with 2011.
During the same two-year period, volumes from northern Europe to South America overtook northbound liftings, increasing 10.3% to 628,576 teu.
Hamburg Sud and Maersk modify their North Europe - East Coast South America services
Hamburg Sud will change the port rotation of its PLATE EXPRESS by removing Tilbury from the rotation whilst adding port calls at London Gateway Port and Paranagua (Northbound) to the rotation. The new route will be inaugurated from Rotterdam by the vessel CAP SAN AUGUSTIN on 16th April. MSC (NORTH EUROPE STRING IV), Hapag Lloyd (BPX), CMA CGM (SAFRAN 1), Maersk and CSAV are all taking slots on the service.
The PLATE EXPRESS deploys 7 vessels on a weekly frequency and a 49 day rotation. Its average weekly service capacity has been increasing from 7,150 TEU in February to 8,600 TEU in April and is expected to climb to 9,000 TEU in May.
Simultaneously MSC is changing the port rotation of its North Europe – East Coast South America SAEC 1 Service. Buenos Aires, Rio Grande and Sepetiba are withdrawn from the port rotation whilst Hamburg, Lisbon (southbound), Rio de Janeiro (northbound) and Salvador are added to it. The vessel MSC BARCELONA will inaugurate the new route from Antwerp on 15th April.
The service deploys 7 vessels on a weekly frequency and a 49 day-rotation. It has an average service capacity of 5,850 TEU per week. The carriers Hamburg Sud (MERCOSUR), Maersk (SAMEX), CMA CGM (SAFRAN 2), Hapag Lloyd (BLX) and CSAV (EUROATLAN LA PLATA STRING) are all slot sharing on this service.
PLATE EXPRESS: Rotterdam - London Gateway Port (new) - Hamburg - Antwerp - Le Havre - Sepetiba - Santos - Paranagua - Buenos Aires - Montevideo - Rio Grande - Itapoa - Paranagua (new) - Santos - Tanger Med – Rotterdam
SAEC 1: Antwerp - Rotterdam - Hamburg (new) - Bremerhaven - Le Havre - Lisbon (new) - Sines - Rio de Janeiro - Santos - Navegantes - Santos - Rio de Janeiro (new) - Salvador – Antwerp
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