The Far East to East Coast of North American shipping line ushers in new opportunities

By Zhao Bo

The Far East to East Coast of North American shipping line ushers in new opportunities

By Zhao Bo

On August 22, 2017, “Theodore Roosevelt”,the container ship over 14000 teu of CMA-CGM, smoothly passed through the expanded Panama Canal, and on September 7, berthed at Elizabeth terminal in New York - New Jersey port invested and operated by Maersk Terminal Company(APMT).

Being different from the exploratory operation which had repeatedly called the 18000TEU container ships to anchor at North American West Coast ports, CMA-CGM will use the "Theodore Roosevelt" and a series of same type container ships to make routine deployment in the far-East to the east coast of North America line. It is reported that this part of the large capacity will be used for SAX route under CMA-CGM operation so as to share space with OCEAN Alliance members.

According to the analysis of the Baltic International Shipping Association (BIMCO), in the 1～6 months of 2017, the market volume demand for Far East to West Coast of North America line and to East Coast of North America line has increased by 5.4%and 10.6% respectively compared with the same period of last year. Some experts say that if there is no strong interference of some political factors, this demand growth may run through the whole of 2018. Faced with such a rare opportunity, no liner company will let it pass by.CMA-CGM and many liner companies have fairly good expectations for the market demand for the fareast to East coast of North America line, and this expectation comes from the good prospect for the trade between China and America. Recently, the International Monetary Fund (IMF) has up-regulated the U.S.economic growth in 2017 and 2018 by 0.1 percentage points and 0.2 percentage points to 2.18 percent and 2.34 percent, at the same time, the Chinese economic growth in 2017 and 2018 has also been up-regulated to 6.77% and 6.5%. Apart from that, the volatility of the global exchange rate market may also lead to more growth in American import. The low exchange rate of RMB against the U.S. dollar will further enhance the consumption capacity of the United States of China's export commodities, thus driving the smooth rise of container trade volume. Clarkson recently said, as of September this year, along the Far East - east coast of North America shipping line passing through the Panama Canal, liner companies have invested 90 container ships with 8000TEU ～12000TEU single ship capacity, and Panama container ships which have been replaced are used for the north and south route and other secondary routes.

In recent years, the competition between the shipping companies on the Far East to the East Coast of North American line is very fi erce, and this can be seen from the change of the ship type. As of now, the average single ship capacity of container ships passing through Panama Canal is about 6573TEU, increased by 61%compared with 2013. This growth was largely due to the influx of large capacity. Drewry has once pointed out in his article that, along with the gradual recognition of the navigation capacity of the expanded Panama Canal,the tendency of large container ships in the far east to east coast of North America line will continue, and the hope to have the advantage in capacity may be one of important reasons for liner companies to invest more in larger capacity in this line.

In order to receive larger and larger capacity, the eastern coast of the United States has made enough preparation.On the day when the “Theodore Roosevelt” ship berthed at Elizabeth terminal of New York - New Jersey container port, Maersk terminal company said that the arrival of the ship depicted the prospect of the Far East to east coast of North America line, Elizabeth container terminal plays an important role in this shipping market,and in the future, it will combine with the upgraded Benayoun bridge and expanded Panama Canal to meet the operational requirements of ultra large container ships.

In order to attract more and more cargo to load, unload and transfer in Miami port, Miami port is equipped with more shore cranes. In order to cope with the possible cargo volume peak in the future, Miami port, which attaches great importance to container transshipment business, has made adequate preparations for multimodal transport.

With liner companies increasing investment and ports developing infrastructure construction, it can be seen that both sides are optimistic about the market development prospect of far-east to east coast of North America shipping line, and there is a reason to believe that this market will bring surprises.