Ocean cargo carriers still getting chummy

When we predicted that the Chinese government would object to the P3 Alliance, there was speculation that China had something else on its agenda.

Now comes news that China Shipping Container Line (CSCL) will join CMA CGM and United Arab Shipping Corp (UASC) in a vessel-sharing agreement dubbed “Ocean Three.”

The new partnership – pending approval from the U.S. Maritime Commission – will cover the Asia-Europe, Asia-Mediterranean, transpacific and Asia – U.S. East Coast trades.

Earlier this year, UASC and CSCL agreed to share space on their new 18,000 TEU mega-vessels in the Asia-EU trade lanes. And while agreements for the transatlantic are yet to be detailed, the Ocean Three will cover half a dozen lanes linking shippers in Asia-Europe. The Asia – Mediterranean trade will have four services, with five transpacific and two Asia-U.S. East Coast deployments planned.

Shipping analysts are expected to weigh in soon on the potential impact this will have on the marketplace, but we suspect that they will come to many of the same conclusions:

China’s demand economy ensures that its commercial fleets are protected. Rates will become firmer. And capacity will finally be better utilized.

U.S. Logistics managers should brace themselves for tougher negotiations in 2015.