Tuesday, January 3, 2017

Container Lines Extend Freight Share Cooperation Begun by Hanjin Collapse

Former Competitors Draw Closer to Rationalise Trade
Shipping News Feature
SOUTH KOREA – WORLDWIDE – Having last month successfully negotiated the terms in a new tie-up with the world two largest container shipping firms, troubled South Korean shipper, Hyundai Merchant Marine (HMM) has announced the signing of an MoU with intra-Asia freight trade carriers and local competitors, Heung-A Shipping and Sinokor Merchant Marine, to form the ‘HMM + K2 Consortium’.

With plans to sign formal contracts next month, the HMM + K2 consortium will start operations in March, covering the Japan, China, and South East/West Asia trade lanes, allowing HMM to access fully the Intra Asia networks of Heung-A and Sinokor, which particularly focus on the Korea-Japan and Korea-China routes, among others. The parties state that the agreement shall be automatically renewed for successive two year terms.

HMM + K2 consortium will include Vessel Sharing, Slot exchange, and Slot purchase agreements, as well as additional plans to bring in joint investment in port infrastructure and sharing of container equipment in the medium and long term.

The three South Korean shipping lines previously collaborated to support the local ocean freight market in the wake of the Hanjin Shipping bankruptcy. Towards the end of September 2016, HMM, Sinokor, and Heung-A, along with Korea Marine Transport, formed the Mini Alliance deploying 15 vessels on four Southeast Asian routes, covering Singapore, Malaysia, Indonesia, Vietnam, and Thailand, in order to minimise losses of the shippers in the region.

Photo: Sinokor Merchant Marine is considered a suitable partner for HMM.