A trio of Japanese carriers have formed a joint venture, robotic vessels are coming from MOL, and container rates are rising.
Three Japanese shippers are banding together
There’s a new shipping consortium on the high seas.
Kawasaki Kisen Kaisha Ltd., Mitsui O.S.K. Lines Ltd. and Nippon Yusen Kabushiki Kaisha said their new joint venture will operate under the trade name “Ocean Network Express.”
The establishment of the joint venture, one of many created in recent years by ocean freight carriers, will integrate the three companies’ container shipping businesses, including worldwide terminal operation businesses, excluding those in Japan. The company first announced news of the joint venture in October.
The establishment of a holding company is currently planned in Japan and an operating company will be incorporated in Singapore. In addition, regional headquarters of the operating company will be set up in Singapore, Hong Kong, London, Richmond, Virginia and Sao Paulo, Brazil.
The move will allow Ocean Network Express to better meet customers’ needs by providing high-quality, competitive services through the consolidation and enhancement of the trio’s global network and service structures.
Last year, the Ocean Alliance, comprised of China’s COSCO Shipping, France’s CMA CGM, Taiwan’s Fra Evergreen Marine and Hong Kong’s Orient Overseas Container Line Ltd. was created, along with The Alliance, an agreement between five major container shipping companies—Hapag-Lloyd, K Line, Mitsui O.S.K. Lines, NYK Line and Yang Ming. The new ventures are an effort to lower costs and become more efficient in serving trade routes.
The establishment of the Ocean Express Network, which still needs final anti-trust approvals, is set to commence April 1, 2018.
Autonomous shipping may not be far ahead
Who’s at the helm? Maybe nobody.
Mitsui O.S.K. Lines Ltd.’s president and chief executive officer Junichiro Ikeda recently announced that its joint project with Mitsui Engineering & Shipbuilding Co. on developing a technological concept for autonomous ocean transport system was selected by Japan’s Ministry of Land, Infrastructure, Transportation and Tourism for its Transportation Research and Technology Promotion Program.
Members of a research consortium on the project will develop the technological concept for autonomous vessels and set a course toward development of the technology needed to create autonomous ships that can provide reliable, safe and efficient ocean transport.
The project will also foster a movement to develop the required infrastructure and win public support for putting these advanced technologies in place by sharing the results with the public and the maritime industry throughout the research.
Freight rates are rising
Global container freight rates are on an upward trajectory.
Drewry’s World Container Index, a composite of container freight rates on eight major routes connecting the U.S., Europe and Asia, is up 1.4% to $1,466.36 per 40-foot container for the week ended Thursday.
Compared to the same period a year earlier, the composite index showed an 18 percent increase.
For the year to date, the average composite index is $1,575 per 40-foot container, which is $121 lower than the five-year average of $1,696.
The spot rates on the Asia-Europe trade have started to rise, according to Drewry, which has resulted in the WCI on Shanghai to Rotterdam gaining 2 percent or $42, to $1,801 for a 40-foot container. Similarly, the rates on Shanghai to Los Angeles increased 3 percent to $1,293, but the rates on Shanghai to New York registered a 1 percent decline.
“Since more carriers will implement rate hikes during the latter part of this week, we expect rates to strengthen on the Asia-Europe and Transpacific routes,” Drewry noted.