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Three jokers could upset rates picture for container lines: Alphaliner

Three jokers could upset rates picture for container lines: Alphaliner
While there is optimism that the recent wave of consolidations may lead to a better future for rates in the liner shipping market, there are wild cards that may still cause an upset.

Speaking at the Asian Logistics and Maritime Conference in Hong Kong, Maersk China chairman Tim Smith said: "Next year when you have the top seven or so liner companies controlling around 65% of the world's fleet that may give a platform for a different, more stable future."

"There are three jokers in the pack that will emerge next year," said Alphaliner executive consultant Tan Hua Joo, pointing out that these are Zim, Hyundai Merchant Marine (HMM) and the potential entry of Korea Line, which is taking over Hanjin Line's transpacific operations.

Based on his assumption that HMM will end up failing to join the 2M alliance, Tan said: "So apart from the fact that you have three equally strong global alliances, you are still facing challenges from three non-alliance carriers and their actions will have a significant impact on how rates are set for next year."

He noted that the challenge is obvious in that even though the major alliances control up to almost 100% of the capacity on some trades, they are still unable to effectively control rates overall.

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