US Port Expresses Carrier Alliance Optimism

US Port Expresses Carrier Alliance Optimism

Port of Oakland expects the upcoming changes in container shipping to cause “little disruption” when the Ocean and THE alliances come into effect on April 1, 2017, as the industry undergoes consolidation and carrier lines cut excess vessel capacity to trim costs.

In an announcement on its website, the port said it expects two-to-three months for all alliance changes to take hold but that cargo volume will “hold steady” once new alliances begin operation.

The process includes slotting vessels into new service rotations.

In some cases, older ships will be replaced with newer, larger ones.

John Driscoll, Port of Oakland Maritime Director, said: “We’ve spoken to the shipping lines, we’ve spoken to our marine terminal operators and we understand their schedules.

“We’re confident that Oakland will be able to accommodate the newly formed alliances efficiently.”

The port expects 29 weekly and two fortnightly vessel calls after the new alliance structure.

Even in its position as a major gateway for US exports, particularly agricultural exports, the authority expects cargo relocation to be “minimal” as most of its vessel calls are concentrated in just three marine terminals.

It also anticipates that there will be no loss of cargo in Oakland, even though weekly vessel calls will decrease from 32 to 29.

There will also be more direct vessel calls between Southeast Asia and Oakland taking place, including a direct call to the Indian Subcontinent.

The authority also stated that the strong Oakland-to-Japan and Oakland-to-Korea service for refrigerated exports will continue.

Carriers are changing partners after bankruptcy, acquisitions and consolidation roiled container shipping in 2016.

Eleven of the world’s largest container shipping lines are coming together in three new alliances, 2M headed by Maersk Line and Mediterranean Shipping Company (MSC), and Ocean led by CMA-CGM. 

THE Alliance consists of NYK Line, MOL, “K” Line, Hapag-Lloyd, and Yang Ming Line, with the recent Hapag-Lloyd merger meaning United Arab Shipping Company has joined the carrier force.

But the new structures, which will let participating carriers share ships and port calls to reduce expense while expanding service, are unnerving some industry experts.

They foresee port disruption if arrival schedules change or shipping lines redirect to different marine terminals.

The worry is that cargo flow could be inhibited leading to congestion at major ports.

The Co-Founder of iContainers, Carlos Hernández, recently warned that the new shipping alliances will lead to a shortage of options for freight forwarders but may create a stronger sector.

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