Drewry: trans-Suez container services “bit players” no more
Drewry: trans-Suez container services “bit players” no more
A new report from the Drewry Shipping Consultants says the time is ripe for growth in trans-Suez container services between Asia and the East Coast of North America.
“Despite brief excitement at the possibility of Suez routes from (Southeast) Asia to ECNA in the early 1990s, the concept has failed to convince carriers that it was a cost effective possibility — and as the cargo source in Asia has concentrated evermore in China, and down-rated the significance of the SE Asian market, the idea has almost disappeared from the schedules,” Drewry said.
But times have changed, the group said. While West Coast ports have not suffered from congestion disruption at West Coast ports since 2004, they still have a need “to develop long term alternatives.”
“The factors which have previously prevented the concept from playing anything more than a bit part in the transpacific container trade are all coming together,” Drewry said.
Trans-Suez services to the U.S. East Coast require an additional ship in their strings when compared to trans-Panama services, said Philip Damas, Drewry research director. However, the report said this is being counterbalanced by continuing double-digit transpacific trade, competitive transit times between port pairs and the ability to justify extending Suez vessels to Hong Kong and Shenzhen in China.
In addition, more post-Panamax ships are coming on stream and key ports such as New York will complete dredging projects in the next few years that will allow post-Panamax ships to call at more terminals with more cargo.
“Already in 2006, Maersk Line has inaugurated a new Suez string from SE Asia, and more carriers are known to be looking closely at the idea. But the true breakthrough for the Suez route on the transpacific trade will be when the economics of extending these services to the enormous southern China market become convincing,” Drewry said.
Its analysis “suggests that the moment has already arrived, and that carriers and importers should be positioning themselves now to participate in the new opportunities which are presenting themselves.”