COPENHAGEN: Exporters and importers shipping cargo containers directly to Mediterranean destinations through the Chennai port will have to re-route them via Colombo, Salalah or Singapore from October as Maersk Line, world’s biggest container shipping line, has decided to shut its weekly direct service which was started in February.
The Danish carrier’s announcement on Wednesday to discontinue the Indian subcontinent-Mediterranean service or ME5 just a few months into its operations has surprised many in the shipping industry. The termination of the direct service will make India depend more on neighbouring transshipment ports.
The service linked Chennai port with Colombo, Salalah, Djibouti, Jeddah, Aqaba, Port Said, Genoa, Valencia and Algeciras, deploying seven vessels each with a capacity to load as much as 4,600 twenty foot equivalent units (TEUs). A TEU is the standard size of a container and a common measure of capacity in the container business.
“In our continuous effort to provide our customers with an attractive and competitive West Central Asia/Europe network— both in terms of capacity and coverage—Maersk Line is enhancing the ME1, ME2 and ME3 services and discontinuing the ME5 service with effect from October 2015,” Maersk Line said in a statement.
“The termination of the service will not impact our ability to serve our customers in the market that the ME5 covers. We are adding new port calls to the ME1, ME2, ME3 services and, at the same time, launching a dedicated feeder shuttle between Chennai, Colombo and Salalah to ensure a world-class product between West Central Asia and Europe,” it said.
Container shipping executives see the decision by Maersk as a fallout of the plunging freight rates, over-capacity and slowing demand. “The announcement has come as a surprise because the container ships deployed on the service were loading as much as 3,000 TEUs per sailing,” a spokesman for Chennai Port said.
“The discontinuation of the direct service by Maersk is a serious issue for exporters,” said K. Unnikrishnan, joint deputy director general at the Chennai-based southern regional office of the Federation of Indian Export Organizations or Fieo. “We were struggling to get direct vessels calls when Maersk came up with this service in February,” he said.
“Re-routing the containers through Colombo, Salalah or Singapore will lead to extra time and costs for sending or receiving cargo,” said A.V. Vijayakumar, a Chennai-based customs house agent.
Shipping activity at Port Qasim on February 11
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