China Shipping ends experimental service to Halifax
China Shipping will end its vessel calls to the Port of Halifax in early August — a setback to the Halifax Port Authority’s strategy to build container business through the Suez Canal.
But the loss of the Asia-Mediterranean-America, or AMAX, service doesn’t mean China Shipping is "abandoning Halifax," says Bernie Dumas, general manager of sales and marketing for China Shipping (Canada) Agency Co. Ltd. Mr. Dumas said there may be an opportunity for the ships to return in late fall or early next year.
The shipping line had been doing an import-export business through a slot charter arrangement with Zim Container Line since 2002, and that will continue.
The decision to end the AMAX service was based on the fact it wasn’t performing as well as the company had hoped.
"The AMAX service has been in operation for about two years (since October 2005) and it really was an experiment for China Shipping Container Lines," Mr. Dumas said Tuesday.
"It was sort of an oddball service in a sense that it has a round-the-world operation and the revenues produced by the service were not up to (company) needs, and they decided to disband it and reallocate the ships to other services. They are basically looking at the possibility of doing something in Halifax later on, but this service was just not operating to their needs. It happens in this business from time to time."
Port authority spokeswoman Michele Peveril said Tuesday that Halifax has been one of the "strong performers" in a string of 20 ports in the service. She said China Shipping had increased its container volume through Halifax by 22 per cent by the end of May, compared with the same period in 2006. Ms. Peveril said the authority wants to build on the port’s performance.
"At the moment we are working with China Shipping and our local partners, including CN, to see if Halifax can be included in any new (future) services that will include East Coast ports of call," she said.
The port will also continue to develop "the diverse markets that we have been pursuing for cargo growth that range from Southeast Asia to the Mediterranean to the Caribbean and Europe."
China Shipping had 10 vessels in the service rotation calling at Halterm. The service included import and export business and moving more than 600 ten-foot equivalent units per vessel call. The service started in China, worked through the Suez Canal to the Mediterranean, crossed the Atlantic to Halifax and went down the coast and through the Panama Canal to the Pacific.
Also affected by the decision are the East Coast ports of New York / New Jersey; Norfolk, Va.; Savannah, Ga.; and Miami.
Doug Rose, president and CEO of Halterm, said the news is clearly disappointing "because China Shipping was growing substantially and by all accounts they were really happy with the performance of Halterm and the port as a whole." What the net effect will be in terms of lost cargo to the port will not be known for some time, he said.
China Shipping is a big company with a lot of opportunities to grow, so Mr. Rose is hoping it will return to Halifax "sooner rather than later with some kind of a service from the Far East through the Suez."
In addition to the possibility of Zim picking up some of the cargo from China Shipping, Mr. Rose said Halterm has other strong services from the Mediterranean, such as Costa Container Line and Melfi Marine, which could pick up some business.
Lines that call at Fairview Cove terminal, operated by Ceres, could increase their business as lines such as ACL, NYK, OOCL and Hapag Lloyd have a variety of services in the Mediterranean and the Far East.
This will be the second service loss at Halterm since the operator was purchased by Macquarie Infrastructure Partners late last year. Maersk ended its service into Halifax earlier this year.
However, Mr. Rose said Macquarie remains "very committed to the development of Halterm and the port, and we are doing everything we can along with our partners in Macquarie to work with and develop new business."
Container business at the port was down by three per cent by the end of April, compared with the same period last year. Other East Coast ports such as New York and Montreal have also shown slight declines.
But the loss of the Asia-Mediterranean-America, or AMAX, service doesn’t mean China Shipping is "abandoning Halifax," says Bernie Dumas, general manager of sales and marketing for China Shipping (Canada) Agency Co. Ltd. Mr. Dumas said there may be an opportunity for the ships to return in late fall or early next year.
The shipping line had been doing an import-export business through a slot charter arrangement with Zim Container Line since 2002, and that will continue.
The decision to end the AMAX service was based on the fact it wasn’t performing as well as the company had hoped.
"The AMAX service has been in operation for about two years (since October 2005) and it really was an experiment for China Shipping Container Lines," Mr. Dumas said Tuesday.
"It was sort of an oddball service in a sense that it has a round-the-world operation and the revenues produced by the service were not up to (company) needs, and they decided to disband it and reallocate the ships to other services. They are basically looking at the possibility of doing something in Halifax later on, but this service was just not operating to their needs. It happens in this business from time to time."
Port authority spokeswoman Michele Peveril said Tuesday that Halifax has been one of the "strong performers" in a string of 20 ports in the service. She said China Shipping had increased its container volume through Halifax by 22 per cent by the end of May, compared with the same period in 2006. Ms. Peveril said the authority wants to build on the port’s performance.
"At the moment we are working with China Shipping and our local partners, including CN, to see if Halifax can be included in any new (future) services that will include East Coast ports of call," she said.
The port will also continue to develop "the diverse markets that we have been pursuing for cargo growth that range from Southeast Asia to the Mediterranean to the Caribbean and Europe."
China Shipping had 10 vessels in the service rotation calling at Halterm. The service included import and export business and moving more than 600 ten-foot equivalent units per vessel call. The service started in China, worked through the Suez Canal to the Mediterranean, crossed the Atlantic to Halifax and went down the coast and through the Panama Canal to the Pacific.
Also affected by the decision are the East Coast ports of New York / New Jersey; Norfolk, Va.; Savannah, Ga.; and Miami.
Doug Rose, president and CEO of Halterm, said the news is clearly disappointing "because China Shipping was growing substantially and by all accounts they were really happy with the performance of Halterm and the port as a whole." What the net effect will be in terms of lost cargo to the port will not be known for some time, he said.
China Shipping is a big company with a lot of opportunities to grow, so Mr. Rose is hoping it will return to Halifax "sooner rather than later with some kind of a service from the Far East through the Suez."
In addition to the possibility of Zim picking up some of the cargo from China Shipping, Mr. Rose said Halterm has other strong services from the Mediterranean, such as Costa Container Line and Melfi Marine, which could pick up some business.
Lines that call at Fairview Cove terminal, operated by Ceres, could increase their business as lines such as ACL, NYK, OOCL and Hapag Lloyd have a variety of services in the Mediterranean and the Far East.
This will be the second service loss at Halterm since the operator was purchased by Macquarie Infrastructure Partners late last year. Maersk ended its service into Halifax earlier this year.
However, Mr. Rose said Macquarie remains "very committed to the development of Halterm and the port, and we are doing everything we can along with our partners in Macquarie to work with and develop new business."
Container business at the port was down by three per cent by the end of April, compared with the same period last year. Other East Coast ports such as New York and Montreal have also shown slight declines.