ONLY one a year ago, most ships plying North America-South America trade lanes were 2,000 TEU, but now most are in the 5,000-TEU class as the container market becomes dominated by large carriers.
But smaller ships are expected to remain as they are able to call at hard-to-reach ports, such as Iquitos in Peru, according to industry analyst Piers, adding that cargo from west coast South America is mostly auto tyres, as well as fruit and wines.
Mediterranean Shipping Co (MSC), CSAV, Hapag-Lloyd and Hamburg Sud are the biggest operators on the North America-South America trade lane. Between them they operate 66 per cent of the weekly capacity, totalling 39,000 TEU, reported Lloyd's List.
Yet, there are also many smaller carriers on this route such as King Ocean Services, Seaboard Marine, Dole Ocean Liner Express, Trinity Shipping, Seafreight Line and Peruvian Amazon Line.
Together, these lines contribute 15 per cent of capacity - 9,000 TEU - on average per week between North and South America.
Intra-American trade is expected to expand and the infrastructure in South America will need to be upgraded.
The planned Nicaragua Canal, if it goes ahead, will significantly improve options for transiting ships between the east and west coasts.
Also, ports in the region have been investing in new cranes to handle larger ships. The faster ports upgrade, the sooner carriers will call at these facilities with the larger ships that are being displaced by the mega vessels on the east-west trades.
Compared to the larger vessels, the services of the smaller carriers have a quick turnaround time, enabling cargo to reach its destinations earlier. The average transit time for a total loop for the smaller carriers is 23 days while the average for the larger carriers is 50 days.
Smaller operators also have an advantage in being able to accept general cargo as well as containers. This is important for this trade most imports to the US from east coast South America at the end of 2013 were bulky items such as granite and logs.
There are an additional eight services on this route that do not offer fully containerised vessels and instead offer general cargo vessels that can accept containerised freight. These are operated by Industrial Maritime Carriers, BBC Line, Isabella Shipping and Seaboard Marine.
The authors of the report conclude that due to the cargo needs in intra-regional routes such as these, the market that smaller carriers serve will remain in the foreseeable future.
But larger carriers will continue to deploy bigger ships displaced from the east-west trades to cater for the growing containerised trade in paper and auto parts from the US to South America, and fruit and coffee north from South America to the US.
WORLD SHIPPING
28 August 2014 - 22:41
Small ships will not be pushed out by the larger ones in Americas
ONLY one a year ago, most ships plying North America-South America trade lanes were 2,000 TEU, but now most are in the 5,000-TEU class as the container market becomes dominated by large carriers.
WORLD SHIPPING
28 August 2014 - 22:41
Small ships will not be pushed out by the larger ones in Americas
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