Four container shipping lines team up to serve North East Asia-Oceania

Four of the world's biggest container shipping lines have come together to run a joint service that will carry cargoes between North East Asia and Oceania, in a move to further share costs as the industry continues to be affected by oversupply.

Hong Kong-based Orient Overseas Container Lines (OOCL), Shanghai-based China Shipping Container Lines, Singapore's Pacific International Lines (PIL), and France's CMA CGM are running a service departing from Shanghai to North East Asia, New Zealand and Australia, according to statements from OOCL and Marseille-based CMA CGM.

The service, scheduled to begin in November, involves seven container ships with a nominal capacity of 4,250 twenty-foot equivalent unit. Slot exchanges and joint sailings offer extensive port coverage and sailing frequencies that single lines usually find difficult to offer, while allowing carriers to phase bigger vessels into service.

"Container shipping is capital intensive, people intensive and IT intensive. This cooperation is a very natural and common development in container shipping with joint services, slot exchanges and vessel sharing agreements on various trade lanes, especially in all major trades, including intra-Asia trades, are very common," OOCL spokesman Stanley Shen said.

The company has the world's 11th-largest container fleet. The company is a major operator in the China-Australia service, with about 25 per cent market share, added Shen.

Still, there is a limit to how big the vessels could get and "whether terminal infrastructure can support the bigger ships and whether there is enough market demand to fill the ships. Some ports like Bangkok and Cat Lai are shallow draught and the bigger ships cannot berth", PIL said in an emailed reply.