ALPHALINER Weekly Newsletter

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1 ALPHALINER Weekly Newsletter Volume 2018 Issue to Web: Sales: The Alphaliner Weekly Newsletter is distributed every Tuesday. Information is given in good faith but without guarantee. Alphaliner does not accept any liability for any errors or omission or opinion. Please send your feedback, comments and questions to Unauthorized redistribution of the newsletter is prohibited and readers are requested to quote Alphaliner as source for all data derived from the newsletter. Please refer to full user terms and copyrights at Alphaliner Charter Rate Index (Jan 2000 = 100) The containership scrapping rate has slowed significantly since the beginning of 2018 as the nascent recovery in the charter market has kept vessels away from the breaking yards. However, freight rates are moving in the opposite direction, with any slackening in demand likely to threaten the delicate balance in the container market INSIDE THIS ISSUE: Alphaliner Charter Index CCFI (Monthly average) SCFI (Monthly average) Scrapping pace slows down 1 Corporate Updates 2 PIL reports positive financial results ahead of possible refinancing moves Service Updates 3 COSCO and GSL to launch Far East- South Africa service Wan Hai boosts presence on Asia-WCSA route Seatrade teams up with Hapag-Lloyd to offer Transatlantic service CMA CGM organizes Asia-New England (USEC) connections APL closes Hawaii service - Opts for slots on ONE s loop APL and TSL reorganize South China- Philippines connections CNC adds another direct China- Indonesia connection X-Press Feeders introduces two new Qinzhou/Haiphong connections Wan Hai and Yang Ming to introduce direct calls at Panjang Wan Hai and Sinokor to co-operate on Korea-Japan-China-Vietnam trade Maersk organizes dedicated Algeciras- Red Sea relay service Deliveries/Vessel Updates 12 April deliveries Port and Terminal Updates HPUK receives new STS for Felixstowe CMA CGM (re-)joins Lekki project ATI Manila upgrade and 2017 results Eurogate results and automation test 1,600 1,400 1,200 1, China & Shanghai Containerised Freight Index (CCFI Jan 1998 = 1,000)/(SCFI 16 Oct 2009 = 1,000) 14 Chart of the week Capacity scrapped by month in TEU 100,000 90,000 80,000 70,000 60,000 50,000 40,000 30,000 20,000 10,000 0 Jan Mar May Jul Containership scrapping by month : (Based on date of arrival at scrap location - up to 17 April) Sep Nov Jan Mar May Jul Sep Nov Jan Lower scrap rate brings up full-year supply growth estimates Containership scrapping activity has slowed dramatically from the frenetic pace of 2016 and early 2017, with only twelve ships for 21,778 teu sold for recycling so far this year. Alphaliner has adjusted its full-year scrapping estimates for 2018 to only 200,000 teu and this number could be revised downwards further if the currently slow pace of ship-breaking does not pick up in the coming months. The projected vessel capacity to be scrapped this year, somewhere in the 100,000 to 200,000 teu bracket, follows the 413,982 teu of container tonnage recycled last year, and the record of 654,862 teu broken up in the year A further reduction in the rate of vessel scrapping could therefore make this year s container ship-breaking volume the lowest on record since With more than 1.00 Mteu of new container ship capacity still due for delivery between April and December this year, the reduced rate of scrapping has pushed full-year capacity growth estimates up to 6.0%. The total cellular vessel fleet is thus expected to reach Mteu by the end of the year, compared to Mteu at the beginning of While the overall idle containership capacity has been reduced significantly from a record high of 1.60 Mteu in October 2016 to 340,000 teu as of today, the overall market remains delicate with any slackening in demand threatening to disrupt the fragile recovery in the containership charter markets, even as freight rates have started to tumble under the pressure of excess supply. Mar May Jul Sep Nov Jan Mar May Jul Sep Nov Page 1 Copyright Alphaliner

2 CORPORATE UPDATES PIL reports positive financial results ahead of possible refinancing moves Capacity Operated in TEU Thousands PIL PIL has risen to become the 10th largest container carrier in the world, compared to number 18 in 2016, thanks mainly to the withdrawal of several rivals and consolidation moves within the industry in the past two years. However, PIL is struggling to ensure profitability as its previously niche markets in the Red Sea, East Africa, West Africa and Latin America come under scrutiny of larger rivals. APM-Maersk MSC CMA CGM COSCO Shipping Hapag-Lloyd ONE Evergreen OOCL Yang Ming PIL Zim Hyundai M.M. Wan Hai Capacity operated in TEU Millions (as at 1 April 2018) ALPHALINER PIL has reported full year net profits of $85 M in 2017, reversing a net loss of -$225 M in PIL s results include earnings from its container shipping business as well as its container manufacturing subsidiary, Singamas, in which it holds a 41% interest. Its shipping business recorded total revenue of $2,517 M last year, which account for 62% of the group s total turnover of $4,037 M in PIL did not provide separate earnings breakdown of its container shipping operations only but the Hong Kong-listed Singamas had separately reported full year net earnings of $41 M on revenue of $1,477 M in 2017, reversing the net loss of -$59 M in 2016 on total revenues of $916 M. PIL full year financial results : (including shipping and container manufacturing business segments) Revenue 4,516 4,632 3,732 3,070 4,037 Core EBITDA Core EBIT Net Profit PIL s financial results were publicly revealed for the first time only in 2014, after it sought to raise funds on the Singapore bond market. It did not publicly disclose its annual results in past three years but have decided to release its latest financial statements again this year. The move is likely linked to a potential issue of new notes, as it has a substantial amount of loans that are due to be re-financed this year. According to PIL s balance sheet at the end of December 2017, the group has total debt outstanding of $2,912 M, of which $969 M are repayable by the end of PIL had issued three previous series of high yield bonds, but had been forced to pay increasingly higher coupons on these borrowings. Its first tranche of 3-year S$300 M bonds issued in 2014 paid a 5.9% coupon while the second tranche of 3-year S$130 M bonds issued in 2015 paid a coupon of 7.5%. The latest tranche of 3-year S$60 M bonds issued in November 2017 paid a coupon of 8.5%. The high cost of borrowings have weighed down on PIL s earnings, as the group has reported positive net earnings in only two out of the previous five years. Total finance costs in 2017 reached $123 M, compared to $107 M in Page 2 Copyright Alphaliner

3 COSCO and GSL launch Far East - South Africa service COSCO/GSL : ZAX3/SA1 Service Details Asia-South Africa Express Service ZAX3/SA1 (New from May) 8 x 4,200 teu Xingang, Qingdao, Shanghai, Ningbo, Nansha, Singapore, Port Kelang, Durban, Port Elizabeth, Port Kelang, Hong Kong, Xingang COSCO Shipping and Gold Star Line (GSL) will introduce in early May a dedicated Far East - South Africa service that will directly connect China with South Africa while wayporting in the Straits in both directions to further connect with their respective South East Asia networks. COSCO will market the service as 'ZAX3' while GSL will use the 'SA1' appellation. The service will turn in nine weeks. It will initially deploy eight ships of 4,200 teu providing weekly fixed day sailings with one sailing skipped. Six of the ships will be provided by COSCO and two by GSL. The loop will successively call at Xingang, Qingdao, Shanghai, Ningbo, Nansha, Singapore, Port Kelang, Durban, Port Elizabeth, Port Kelang, Hong Kong, Xingang. The first effective sailing is scheduled on 8 May from Xingang with the 4,252 teu SEASPAN FELIXSTOWE operated by CO- SCO. In the southbound direction, it will be the only container service offering a direct connection from Xingang, Qingdao and Nansha to Durban and Port Elizabeth, compared to rival services that currently offer these links by transhipment. In the northbound direction, it will cater in particular to the exports of containerized fresh fruits from South Africa to Asian markets. Johannesburg will be served through an intermodal network primarily via the port of Durban. The ZAX3/SA1 service will once again provide GSL with a direct coverage of the Far East-South Africa trade through direct calls at Durban and Port Elizabeth. GSL s previous venture on the South Africa market dates back to the summer of 2017 with the short-lived 'WAX5/FE3' that covered the Far East-South Africa-West Africa trade and was also jointly operated with COSCO. It was launched in August and lasted only for two sailings. For COSCO, the new ZAX3/SA1 service will significantly enhance its presence on the Far East-South Africa trade by adding to its two existing ships that are operated on this route in two services offered in cooperation with Evergreen, PIL and ONE. Details of COSCO s two existing services are as follows: ZAX 1/FAX-C/ASA C/ASA-C C : Shanghai, Ningbo, Keelung, Singapore, Durban, Singapore, Shanghai using seven ships of 4,200-5,600 teu (3 from Evergreen, 2 from ONE, 1 from COSCO & 1 from PIL) ZAX 2/FAX-S/ASA S/ASA-S S : Kaohsiung, Xiamen, Hong Kong, Shekou, Singapore, Port Kelang, Durban, Cape Town, Port Kelang, Singapore, Kaohsiung using seven ships of 4,200-8,100 teu (3 from ONE, 2 from Evergreen, 1 from COSCO & 1 from PIL) Page 3 Copyright Alphaliner

4 Wan Hai boosts presence on Asia - WCSA route Wan Hai Lines is boosting its presence in the Asia - Mexico - WCSA trade, with the introduction of two new weekly loops, the WSA 3 and WSA 4. Wan Hai : Asia-WCSA Services Details WSA/ASA/WSA3/WSA4 Services operated in cooperation with COSCO, CMA CGM/APL, Evergreen, PIL and Yang Ming. WSA : Kaohsiung, Yantian, Hong Kong, Ningbo, Shanghai, Manzanillo (Mex), Buenaventura, Callao, San Antonio, Callao, Manzanillo (Mex), Yantian, Kaohsiung ASA : Busan, Kaohsiung, Shekou, Hong Kong, Ningbo, Shanghai, Manzanillo (Mex), Lazaro Cardenas, Puerto Quetzal, Buenaventura, Guayaquil, Callao, Manzanillo (Mex), Busan WSA3 : Xiamen, Yantian, Shanghai, Qingdao, Busan, Enseñada, Manzanillo (Mex), Callao, San Antonio, Lirquen, Manzanillo (Mex), Shanghai, Xiamen WSA4 : Kaohsiung, Hong Kong, Shekou, Ningbo, Shanghai, Busan, Manzanillo (Mex), Lazaro Cardenas, Buenaventura, San Antonio, Callao, Lazaro Cardenas, Manzanillo (Mex), Yokohama, Busan, Kaohsiung These new offers will be ensured through slots on two Asia - WCSA services operated by CMA CGM and COSCO Shipping respectively, with APL, Evergreen and PIL also taking slots. The two services were launched in April to replace earlier arrangements in the Asia - Mexico - WCSA trade, with overall market capacity on the route rising by over 20% following the revamp. The WSA 3 and WSA 4 will add to Wan Hai s current offering on the route, ensured with its WSA and ASA services offered jointly with Evergreen, COSCO Shipping, PIL and Yang Ming, with CMA CGM and APL also joining as slot takers from 1 April. Details of Wan Hai s expanded Asia - WCSA offering as follows : 'WSA 3' - Ensured through slots on the multicarrier Far East-WCSA weekly service of CMA CGM, APL, COSCO Shipping, Evergreen and PIL, branded respectively ACSA 2/FCX/WSA 3/WS 3 by these carriers. This service calls at Xiamen, Yantian, Shanghai, Qingdao, Busan, Enseñada, Manzanillo (Mex), Callao, San Antonio, Lirquen, Manzanillo (Mex), Shanghai, Xiamen, using 11 ships of 7,500-8,500 teu operated by COSCO. 'WSA 4' - Ensured through slots on the multicarrier Far East-WCSA weekly service of CMA CGM, APL, COSCO Shipping, Evergreen and PIL, branded respectively ACSA 1/CDX/WSA 4/WS 5 by these carriers. This service calls at Kaohsiung, Hong Kong, Shekou, Ningbo, Shanghai, Busan, Manzanillo (Mex), Lazaro Cardenas, Buenaventura, San Antonio, Callao, Lazaro Cardenas, Manzanillo (Mex), Yokohama, Busan, Kaohsiung, using 11 ships of 10,000-11,000 teu operated by CMA CGM. 'WSA' Asia-Mexico-WCSA weekly service operated jointly with Evergreen, COSCO Shipping, PIL and Yang Ming who respectively brand it WSA/WS/SA4. This service calls at Kaohsiung, Yantian, Hong Kong, Ningbo, Shanghai, Manzanillo (Mex), Buenaventura, Callao, San Antonio, Callao, Manzanillo (Mex), Yantian, Kaohsiung, using tonnage of 8,000-10,000 teu. 'ASA' Asia-Mexico WCSA weekly service operated jointly with Evergreen, COSCO Shipping, PIL and Yang Ming who respectively brand it WSA2/WS2/SA6. This service calls at Busan, Kaohsiung, Shekou, Hong Kong, Ningbo, Shanghai, Manzanillo (Mex), Lazaro Cardenas, Puerto Quetzal, Buenaventura, Guayaquil, Callao, Manzanillo (Mex), Busan, using tonnage of 4,200-6,500 teu. Page 4 Copyright Alphaliner

5 Seatrade teams up with Hapag-Lloyd to offer Transatlantic service Seatrade : USEC-Europe Services Details New from Apr 2018 Slots on Hapag-Lloyd AL2/AL3/AL5 AL2 : Charleston, Savannah, London- Gateway, Rotterdam, Le Havre, Bremerhaven AL3 : Savannah, Norfolk, London- Gateway, Antwerp, Bremerhaven AL5 : Savannah, Southampton, Rotterdam, Hamburg, Antwerp, Le Havre StreamLines, the Curaçao-based container transportation arm of specialized reefer carrier Seatrade, has concluded a strategic cooperation agreement with Hapag-Lloyd starting with a slot charter agreement in the US East Coast-North Europe trade. From 13 April, the carrier will buy from Hapag-Lloyd a slot allocation of 250 teu per week, including 100 reefer plugs, on three Transatlantic services, all operated within the scope of THE Alliance. The move allows StreamLines to offer three weekly sailings from Savannah and one sailing from both Charleston and Norfolk to North Europe. The new Transatlantic service has been announced by StreamLines as one-way eastbound, but the cooperation agreement filed with the Federal Maritime Commission (FMC) in Washington mentions the possibility of StreamLines buying a similar amount of slots from Hapag-Lloyd on westbound sailings. Seatrade has offered itself weekly US East Coast-North Europe liner services for reefer cargo in containers in the recent past. The former Central America-North Europe Blue Stream container service, which deployed six 1,300-2,100 teu vessels, included eastbound calls at Port Canaveral (Florida), Wilmington (North Carolina), Tilbury, Rotterdam, Dunkirk and Radicatel. All containerships of the Blue Stream service are being replaced this month by conventional reefer cargo vessels that will ply a revised rotation which does not include calls in the United States. Seatrade has also offered a Philadelphia-North Europe connection with its former Europe - USA - Oceania Meridian loop, which was merged last year with the CMA CGM/Marfret PAD/NASP service after which Seatrade left the joint service as an operational partner. Details of the Seatrade slot arrangement with Hapag-Lloyd stand as follows: AL2 service - StreamLines has an allocation between Charleston, Savannah, London-Gateway, Rotterdam, Le Havre, Bremerhaven. AL3 service - StreamLines has an allocation between Savannah, Norfolk, London-Gateway, Antwerp, Bremerhaven. AL5 service - StreamLines has an allocation between Savannah, Southampton, Rotterdam, Hamburg, Antwerp, Le Havre. Page 5 Copyright Alphaliner

6 CMA CGM : Asia-New England Service Details New relay service Relay via Halifax Hong Kong, Cai Mep, Singapore, Port Kelang, Colombo, Halifax Then relay on Eimskip s Halifax to Portland (Maine) service. CMA CGM organizes Asia - New England (USEC) link CMA CGM has organised a connection between Asia and the New England region of the United States, through transhipment at Halifax. The French Line s transhipment offer will connect the carrier s Far East - USEC 'Columbus-JAX' service, offered within the OCEAN Alliance as the 'PSW3 + AWE3' pendulum, and the Halifax - Portland (Maine) leg of Eimskip s 'Green Line' Iceland - North America service. Located in the state of Maine, Portland acts as a gateway for the New England region. The relevant leg of the CMA CGM 'Columbus' service connects Hong Kong, Cai Mep, Singapore, Port Kelang and Colombo with Halifax via the Suez Canal route. Transhipments can be organized from other East Asian and ISC ports to benefit from the new connection. APL closes Hawaii service - Opts for slots on ONE s AHX APL (CMA CGM Group) is closing its own Far East - Hawaii 'Aloha Express' service and will continue to cover Hawaii through slots on the established 'Asia Hawaii Express' (AHX) service offered by ONE on a weekly basis. APL : AHX Service Details AHX (replacing APL s own fortnightly service) Slots on ONE Shanghai, Busan, Yokohama, Honolulu, Yokohama, Shanghai The AHX service was initiated by NYK in 2012 and has been incorporated under the ONE banner from 1 April APL will henceforth provide weekly sailings instead of the fortnightly departures that it provided with its own service. According to the carriers' filings with the FMC, APL will have an initial slot allocation of 150 teu per week. The first APL sailing on the ONE 'AHX' service is scheduled on 19 May from Shanghai. APL launched the 'Aloha Express' in July 2017 on a fortnightly basis with three chartered ships of around 1,000 teu, in direct competition with the (then) fortnightly NYK service. NYK reacted to the new competition by increasing the frequency of its 'AHX' from fortnightly to weekly sailings. The 'AHX' connects Shanghai (Waigaoqiao), Busan, Yokohama, Honolulu, Yokohama, Shanghai. It turns in five weeks with five ships of 700-1,000 teu. Page 6 Copyright Alphaliner

7 APL and TS Lines re-organize South China - Philippines connections APL/TSL : CP1 Service Details South China-Philippines 1 2 x 2,000-2,400 teu Xiamen, Hong Kong, Nansha, Shekou, Manila (N + S), Batangas, Xiamen APL (CMA CGM Group) and TS Lines are to reorganize in mid-april their South China - Philippines connections with the introduction of an enhanced CP1 service that will include Xiamen, Batangas and two terminals in Manila, while the current CP2/NSX service will be closed. Of note, APL will continue to offer its own CP3 service, which connects South China with Manila through slots on a segment of sister company Cheng Lie's BMX service, while TSL will also continue operating its CPX service. Each carrier will therefore continue to provide two weekly loops, connecting the two countries, compared to the previous three loops arrangement introduced in December Annual Throughtput in TEU Millions Container throughput at Manila ( ) The extended CP1 service that will remain jointly operated by APL and TS Lines, successively calling at Xiamen, Hong Kong, Nansha, Shekou, Manila (N + S), Batangas, Xiamen. It will turn in two weeks instead of one, using the 2,078 teu MAGNAVIA (TS Lines) and the 2,474 teu MERATUS JAYAKARTA (APL). Ship size this doubles, compared to the 1,000 teu vessel deployed on the current CP1. The first sailing under the revised loop structure was performed by the MAGNAVIA on 16 April from Xiamen. The upgraded CP1 will replace the CP2/NSX, only launched as recently as early December last year. The loop called at Hong Kong, Nansha, Chiwan, Manila (South), Hong Kong using the 1,118 teu IONIAN EXPRESS, which has been withdrawn since the end of February. In addition, APL and TSL will retain their two separate South China- Manila connections through the following services: APL s existing CP3 service (slots on strings of Cheng Lie s 'BMX' service), limited to the following calls : Yantian, Nansha, Chiwan, Hong Kong, Manila (North + South)... Shantou. TS Lines existing CPX service, calling at Nansha, Shekou, Hong Kong, Manila (N + S), Nansha. It is currently operated with the 1,118 teu VEGA KAPPA, shifted from the suspended CP2 service for only one sailing before being replaced the following week by a yet-to-be-named ship. The reorganization allows APL and TSL to enhance Xiamen direct connections with Manila and to add a direct call at Batangas to better serve the Calabarzon region in the Philippines. The upgrade in ship size of the enhanced CP1 will be more than sufficient to offset the loss of tonnage from the suspension of the CP2 service. Page 7 Copyright Alphaliner

8 CNC to add another direct China-Indonesia connection Cheng Lie Navigation Co (CNC CMA CGM Group) has added another direct connection between the China and Indonesia markets through slots on certain port calls on the southbound leg of COSCO s China Indonesia Express (CIX). CNC will retain the CIX name to market its service, which is scheduled to start on 24 April. CNC : CIX Service Details China Indonesia Express (from Apr 2018) Slots on COSCO CIX service Qingdao, Shanghai, Fuzhou, Shekou, Jakarta, Surabaya X-Press Feeders : HQH/SQH Service Details Hong Kong-Qinzhou-Haiphong (HQH) Singapore-Qinzhou-Haiphong (SQH) HQH : 1 x 2,700 teu TBR 1,100 teu SQH : Slots on ESL then relay on HQH HQH : Hong Kong, Qinzhou, Haiphong, Qinzhou, Hong Kong SQH : Singapore, Qinzhou on ESL/RCL Galex/AIM service then relay on HQH continues on next page... CNC will only participate in the following calls : Qingdao, Shanghai, Fuzhou, Shekou, Jakarta and Surabaya. Of note, The CIX service s full rotation turnaround time has just been extended from four to five weeks with the addition of Yingkou, Xingang and Yantai calls in early April. It is currently operated by COSCO with four ships of 4,200 teu and one vessel of 2,500 teu. The CIX service will provide CNC with a direct connection between Fuzhou in China and the Indonesian main ports of Jakarta and Surabaya. It will further enhance the frequency of weekly sailings between Shanghai, Qingdao and Indonesia. CNC currently serves the Shanghai-Indonesia route with two existing links, its own China 1 service, and slots on the CVI of SITC. CNC also serves the Qingdao - Indonesia route using the KCS, a joint service with its sister company APL. X-Press Feeders introduces two new Qinzhou/ Haiphong connections X-Press Feeders has announced this week the introduction of two direct connections covering Qinzhou in South West China and Haiphong in North Vietnam. The first connection is a new weekly service dubbed Hong Kong Qinzhou Haiphong (HQH) and the second connection is ensured through slots on the Singapore - Qinzhou port pair of the Galex/AIM service jointly operated by Emirates Shipping Line and Regional Container Line, marketed as Singapore Qinzhou Haiphong (SQH) service by X- Press Feeders. The HQH service turns weekly using the 2,714 teu X-PRESS MAKALU for its first two sailings, to be replaced by the 1,121 teu HAIAN SONG, freshly chartered by X-Press Feeders from the Vietnamese ship owner and operator Hai An Transport. The HAIAN SONG is scheduled to join the service on 24 April in Hong Kong. The loop connects Hong Kong, Qinzhou, Haiphong, Qinzhou, Hong Kong. The first effective sailing has occurred on 10 April from Hong Kong. X-Press Feeders last foray into the Qinzhou-Haiphong market was in October 2016 when it organized a weekly shuttle between the two ports. It was marketed as 'Qinzhou Haiphong Express' (QHX) but the short lived service was suspended after only a few sailings. Page 8 Copyright Alphaliner

9 Annual Throughput in TEU 140, , ,000 80,000 60,000 40,000 20, continued from previous page Wan Hai/Yang Ming : SJ1/SEA Service Details Strait Java 1/Southeast Asia service (revamped in April) 2 x 2,700 teu Port Kelang (W+N), Singapore, Jakarta, Surabaya, Panjang, Jakarta, Port Kelang Container throughput at Panjang ( ) The SQH service first effective sailing occurred on 4 April from Singapore and the 'SQH' complements X-Press Feeders existing Singapore-Haiphong connections by using Qinzhou as the transhipment point with a connection to the new HQH service to Haiphong. Wan Hai & Yang Ming to introduce direct calls at Panjang (Indonesia) Wan Hai and Yang Ming will introduce a direct call at Panjang, a port located at the southern tip of Sumatra Island. Indonesia, with a joint service that will directly connect the Singapore and Port Kelang hubs with Jakarta, Surabaya and Panjang in Indonesia. The offer will be marketed as Strait Java 1 (SJ1) by Wan Hai and as 'SEA' by Yang Ming. It will encompass Yang Ming s current 'SEA' service, which connects Port Kelang and Singapore with Jakarta. The SJ1/SEA will turn in two weeks and it will be operated with two ships, the 2,702 teu SENDANG MAS, freshly chartered by Yang Ming from Indonesian domestic ship owner and carrier Temas Line. The second ship will be the 2,732 teu INTERASIA PROGRESS operated by Wan Hai. The first effective sailing is scheduled on 20 April from Port Kelang. Panjang port is thus far served by three shuttles that connect with the Straits hubs for transhipment : MCC Transport Merak + Panjang feeder to Tanjung Pelepas and Singapore (1,134 teu per week); MSC Malyndo Express Panjang + Jakarta feeder to Tanjung Pelepas and Singapore (2,256 teu per week); The PIL-ACL Jakarta + Panjang shuttle to Singapore (938 teu per week). The SJ1/SEA service will be the fourth loop to serve the route. It will also double the weekly sailing frequency between Singapore and Surabaya for both Wan Hai and Yang Ming to twice weekly. For Wan Hai, the service will add to its existing slots on the COSCO Surabaya feeder service while for Yang Ming it will add to its existing slots on the ITS/ITX service jointly operated by GSL, OOCL and ESL. Of note, RCL, an existing slot taker on the current SEA service, will continue its participation on the extended service and it will expand the slots coverage to include the entire rotation of the service and rebrand it as RSI. The slot partners PIL-ACL, GSL and Zim will also shift their allocation to the enhanced service, but they currently do not advertise the newly-added Surabaya and Panjang calls. Page 9 Copyright Alphaliner

10 Wan Hai KHP/VTS Services Details KHP/VTS (from Apr 2018) Slots on Sinokor KHP : Busan, Ulsan, Kwangyang, Hong Kong (HIT), Haiphong, Ningbo, Shanghai, Busan VTS : Busan, Kwangyang, Hong Kong, Ho Chi Minh City (Cat Lai), Laem Chabang, Bangkok (PAT), Laem Chabang, Hong Kong, Xiamen, Busan Sinokor : JKH Service Details JKH (from May 2018) Slots on Wan Hai Hakata, Moji, Busan, Ulsan, Kwangyang, Keelung, Kaohsiung, Haiphong, Shekou, Hong Kong, Xiamen, Hakata Wan Hai Lines and Sinokor to cooperate in the South Korea - Japan - China - Vietnam trade Wan Hai and Sinokor will engage in late April in a co-operation in the South Korea - Japan - China - Vietnam trade through co-loading on each other s respective services. Wan Hai will take slots on the South Korea - China - Northern Vietnam segment of Sinokor s recently revised KHPR service. The Taiwanese carrier will also take slots on a second service connecting South Korea - China - Southern Vietnam - Thailand that is operated by Sinokor together with KMTC and CK Line, dubbed KVT2/VTS. On its part, Sinokor will take slots on the newly introduced Japan- Korea-Haiphong service (JKH), operated jointly by Wan Hai and Interasia Line. The KHPR service turns in three weeks using three ships of 1,000-1,100 teu connecting Busan, Vostochny, Busan, Ulsan, Kwangyang, Hong Kong (HIT), Haiphong, Ningbo, Shanghai, Busan. Wan Hai will not participate in the Vostochny loop and it will market this service as KHP, with the first effective sailing planned on 19 April from Busan on the FESCO TRADER. The KVT2/VTS service turns in three weeks using three ships of 1,500-1,900 teu, connecting Busan, Kwangyang, Hong Kong, Ho Chi Minh City (Cat Lai), Laem Chabang, Bangkok (PAT), Laem Chabang, Hong Kong, Xiamen, Busan. Wan Hai will retain the VTS appellation to market the service with the first effective sailing planned on 19 April from Busan on SKY ORION. The JKH service turns in three weeks using three ships of 1,200-1,300 teu connecting Hakata, Moji, Busan, Ulsan, Kwangyang, Keelung, Kaohsiung, Haiphong, Shekou, Hong Kong, Xiamen, Hakata. Sinokor will retain the JKH appellation to market the service with the first effective sailing scheduled on 6 May from Busan on WAN HAI 213. The introduction of the KHP service will enable Wan Hai to provide three weekly sailings between South Korea and Northern Vietnam, adding to its current slots on HMM HP3 service and its own newly introduced JKH service. For Sinokor, the introduction of the JKH service will enhance its direct coverage of the Kyushu region in Japan, directly connecting it with Northern Vietnam and South China, a link currently served through transhipment at Busan. The service will also provide a direct connection between Xiamen and Haiphong that was so far covered through Sinokor slots on HMM's HP3 service that have been withdrawn at the end of March. Page 10 Copyright Alphaliner

11 Maersk organizes dedicated Algeciras - Red Sea relay Maersk Line last week launched a weekly Red Sea relay hubbing at the Spanish Gibraltar Strait port of Algeciras. The carrier markets the new offer as its 'ME-6' service. Maersk : ME-6 Service Details ME-6 relay service (from Apr 2018) 3 x 2,500-4,200 teu Algeciras, Aqaba, Jeddah, Aqaba, Port Said East, Algeciras At the same time, Maersk has removed the southbound Algeciras - Aqaba segment from its 'ME-1' service, which connects North Europe, the Red Sea, Middle East and India. The new 'ME-6' relay service will also make a wayport call at Port Said East (SCCT) in the northbound direction. Maersk Line s new service calls at Algeciras, Aqaba, Jeddah, Aqaba, Port Said East, Algeciras and it turns in three weeks with three ships of 2,500-4,200 teu. The 2,824 teu AS CALIFORNIA performed the first 'ME-6' sailing from Jeddah on 13 April and she is to be followed by the 4,256 teu JACK LONDON, scheduled to leave Jeddah on 20 April. The revised 'ME-1' service calls at Felixstowe, Antwerp, Bremerhaven, Wilhelmshaven, Rotterdam, Jeddah, Jebel Ali, Nhava Sheva, Mundra, Salalah, Jeddah, Tangier, Felixstowe. It continues to turn in eight weeks with eight ships of 9,400-10,000 teu DELIVERY/VESSEL UPDATES The KOTA PERDANA and KOTA PERKASA (11,923 teu) are delivered PIL has taken in charge the 11,923 teu sisters KOTA PERDANA and KOTA PERKASA, units seven and eight in a twelve-strong newbuilding program from China s Jiangsu Yangzijiang Shipbuilding. PIL has chartered one of the four 11,923 teu sisters delivered that it received from the shipyard over the past four weeks, the KOTA PEMIMPIN, COSCO Shipping. The Chinese carrier also uses the vessel on the RSS service, which COSCO Shipping brands RES2. Here the ship trades alongside its sister vessels. Originally ordered as 9,800 teu ships between August and October 2015, PIL later decided to modify the contracts in favour of somewhat larger vessels. All twelve ships in the series were funded by Chinese financial institutions which lease the tonnage to the Singaporean carrier under long-term contracts. The remaining four ships of the type are scheduled to come on stream until Q1 of At close to 12,000 teu, the KOTA-P-series are now by far the largest container vessels in PIL s fleet. They have a length of m and a breadth of m (19 rows). PIL s previously largest ships were its six owned KOTA CARUM class vessels of 6,600 teu, as well as a number of 8,000+ teu VLCS which are now being replaced by the newbuilings from Jiangsu Yangzijiang. continues on next page... The KOTA PERDANA has joined on 11 April the new Far East - Red Page 11 Copyright Alphaliner

12 DELIVERY/VESSEL UPDATES...continued from previous page Cellular Containership Deliveries April 2018 Name COSCO SHIPPING GEMINI Teu COSCO SHIPPING LEO 19,273 Operator 20,119 COSCO COSCO KOTA PERABU 11,923 PIL KOTA PERDANA 11,923 PIL KOTA PERKASA 11,923 PIL VOLGA MAERSK 3,596 Maersk KMTC SURABAYA 2,806 KMTC above: the VOLGA MAERSK arrives back at the yard from sea trials. She is the second ship in the Maersk V-River series. photo: COSCO Shipyards below: the V-River series lead ship VIS- TULA MAERSK meanwhile arrived in Northern Europe from China. Here, she is berthed at a waiting pier at Rotterdam, ready to phase into the Baltic Sea service to St Petersburg in Russia. photos: J. Tiedemann Sea service, branded 'RSS' by PIL, jointly operated with the OCEAN Alliance partners, CMA CGM-APL, COSCO, OOCL and Evergreen. This loop had been launched earlier this month under a new set of Far East - Red Sea services, where PIL s 11,923 teu vessels are pooled with the OCEAN Alliance ships under a new joint service arrangement. The KOTA PERKASA is scheduled to phase into the same service on 2 May. The next two ships in the series, to be named KOTA PERKASA and KOTA PERWIRA, will join the PIL fleet later this month. The VOLGA MAERSK (3,596 teu) is delivered - Second ship of new Baltic Sea feeder generation Maersk Line has received on 3 April the VOLGA MAERSK, second unit in a series of seven compact of 3,596 teu container vessels designed specifically for year-round operations in the Baltic Sea. The VOLGA MAERSK, has recently left COSCO Zhoushan Shipyard and she is currently underway in Chinese waters. It is not yet known how exactly the ship will position to Europe. Maersk s second V-class vessel follows the VISTULA MAERSK, delivered on 1 February. The series lead ship just ended her positioning voyage from China via the Cape of Good Hope, West Africa and the Canaries to the Baltic and joined the Rotterdam - St Petersburg service of Maersk-Seago. On the service s two-week round trip, she replaces one of two 1,683 teu vessels. The new Baltic-max ships are, by far, the largest vessels specifically designed for the trade between the European Northern range and the Baltic, and their introduction is changing the scale and the dynamics of this trade. They will cater for Maersk Line's feedering needs and for the intra Europe regional cargoes of Maersk's regional affiliate Seago Line. Ordered in March 2015 at the COSCO Zhoushan Shipyard in China, the new vessels offer a 1A ice class notation and present an Loa of m and a breadth of m (14 rows), for an Lbp ratio of only 5.5. Optimised for colder climates, they feature enclosed bridge wings and an enclosed forecastle mooring deck. Furthermore, the vessels are designed to carry pallet-wide containers, common in the regional European trades. Maersk s Baltic V-class ships can trade at a commercial speed of up to 19 knots, impelled by a six-cylinder MAN-B&W engine of the S70ME-C8.5 model, developing 19,670 kw at MCR. To insure compliance with the strict Sulphur oxide emission stan- Page 12 Copyright Alphaliner

13 DELIVERY/VESSEL UPDATES ALPHALINER dards enforced throughout most of northern Europe, the vessels are designed to exclusively run on marine diesel oil (MDO) rather than heavy fuel oil (HFO). Maersk has opted for this approach despite a more recent trend to have new Baltic Sea ships fitted with gas-burning engines or with scrubbers. above: a size comparison of five larger types of container feeder vessels, designed specifically for service in the Baltic Sea. From top to bottom, they are: Maersk V-River: 3,594 teu / m SDARI 2500(B*): 2,487 teu / m Delphis Baltic: 1,924 teu / m Meyer 1600: Sietas 178: 1,600 teu / m 1,421 teu / m Though commonly referred to as feeders these ships actually also serve regional point-to-point trades. *B: Unlike the standard type, this Baltic Variant of the SDARI 2500 comes with ice class, SOx scrubbers, fully enclosed bridge and other features tailored towards the Baltic Sea trades. The brand new KMTC SURABAYA on sea trials in the Hangzhou Bay and Zhoushan Archipelago. photo: Tsuneishi Group While MDO is generally some 50-60% more expensive than HFO, the ship s comparatively large size and high intake - compared to typical Baltic Sea feeder tonnage - and the resulting low fuel consumption per container carried, will allow Maersk to offset some of that cost disadvantage through scale. The KMTC SURABAYA (2,806 teu) is delivered The KMTC SURABAYA, first unit of a new 2,806 teu wide-beam containership design, has been delivered to Japan s Mitsubishi Corp. on 12 April. The new ship was built by Tsuneishi Zhoushan Shipyard, a Chinese affiliate of the Japanese Tsuneishi Group, which also controls yards at Numakuma, Japan, and at Balamban (Cebu) in the Philippines. Since 2015, when it started to market the design, Tsuneishi Group received a dozen orders for the new 'Tsuneishi 2800' type. All of these were place by Japanese non-operating owners for delivery in 2018 and The KMTC SURABAYA is the first of two ships that Mitsubishi Corp. ordered in the fourth quarter of 2015 with a long term charters to the Korean carrier KMTC. The second ship of the pair, the KMTC PENANG, is currently under outfitting at Zhoushan. The 'Tsuneishi 2800' type has an Loa of m for a breadth of m (14 rows) and a low Lbp to B ratio of 5.4. With this wide beam, the vessels have a summer draft of m, around 0.50 m less than more conventional ships of comparable intake. In line with many recent designs for small and mid-sized container vessels, the ships feature an (almost) bulbless vertical stem. Built at gearless units, the two Mitsubishi sisters are primarily tailored towards the needs of the intra-asia market and they have been fitted with 356 reefer plugs. Powered by an MAN B&W 7G60ME-C9.5 main engine, the ships are designed for a commercial speed of up to 21.1 knots. The KMTC SURABAYA is to join the Korea - China - South East Asia service ANX/ANE, jointly offered by KMTC, Sinokor and TS Lines. She replaces the chartered 2,553 teu ship G. ACE. Page 13 Copyright Alphaliner

14 PORT UPDATES Hutchison Ports UK: New cranes launch era of remotecontrolled pier operations at Felixstowe The Chinese heavy load transporter vessel ZHEN HUA 23 arrives at Felixstowe with two new ship-to-shore gantries. In addition, the vessel carries six rail-mounted storage yard cranes, which it will soon deliver to the Italian port of Vado Ligure. photo: Hutchison Ports UK The port operator Hutchison Ports UK (HPUK) recently disclosed that the two new ship-to-shore cranes delivered to Felixstowe last week will launch the era of remote-controlled gantry operations at the port. The two new cranes, the 32nd and 33rd at the UK's largest container port, were delivered on the transport vessel ZHEN HUA 23 from Shanghai. Clemence Cheng, CEO of the Port of Felixstowe and Executive Director, Hutchison Ports, commented: 'Remote control quay cranes have been pioneered at other Hutchison Ports terminals. Their introduction at Felixstowe will improve the working conditions of the drivers, enhance safety and benefit communications within operational teams.' Further to the new cranes, the port is creating an additional 18,000 teu slots of container storage capacity, upgrading its terminal operating system, raising the height of ten ship-to-shore cranes on Trinity Terminal and has eight additional yard cranes on order for delivery in early The new quay cranes are capable of working on vessels with containers stowed eleven-high and 24-wide on deck. They are thus tailored to work on the largest 'megamax-23' ships in service today and on the upcoming generation of 'megamax-24' vessels on order for delivery in 2019, 2020 and CMA CGM back on board with Lekki, Nigeria Less than a year after CMA Terminals and ICTSI abandoned their joint plans to develop a container terminal at Lekki, Nigeria, the project has risen from the dead. The new Lagos Area satellite port is now slated to come on stream in late 2020 with two deep-water container berths. The French CMA CGM Group this week disclosed that it has signed a Memorandum of Agreement with the Lekki Port LFTZ Enterprise to operate the future container terminal. Located in Nigeria, Africa's largest economy, the future Lekki port will be developed, built and operated by LPLE, a joint venture enterprise led by the Tolaram Group, the Lagos State Government and the Nigerian Ports Authority. As the container terminal operator, CMA CGM, through its wholly-owned subsidiary CMA Terminals, will be responsible for marketing, operations and maintenance of the terminal. The French carrier's Lekki announcement comes shortly after the Page 14 Copyright Alphaliner

15 PORT UPDATES CMA CGM and Lekki Port CMA CGM commented that, the new port's location at Lekki and its deep berths will allow the carrier to 'bring to Nigeria larger container ships from Europe and Asia to better serve our customers and pursue our commitment to the development of the entire region'. The Federal Government of Nigeria recently pledged support to the Lekki Port project during the official flag-off ceremony by President Muhammadu Buhari who was represented by Vice President, Professor Yemi Osinbajo. Lekki Quick Facts Fully completed the port will feature pier length: quay cranes: berth depth: design capacity/ year: 1,200 m 13 units m 2,500,000 teu To open in late 2020 with an estimated capacity of about half the above. ALPHALINER launch of another greenfield container port in West Africa, where CMA CGM is involved: The new Kribi Port opened in March where the carrier participates through a joint venture with its compatriot Bollore Transport & Logistics as well as the Chinese group CHEC. Upon full completion, the Lekki container terminal will be equipped with a 1,200-meter quay and 13 ship-to-shore cranes. It will have a capacity of 2.50 Mteu. With a depth alongside of 16 meters and ultra -large container cranes, the new Lekki terminal will be designed to allow the group to deploy ships with a capacity of up to 14,000 teu. Of note, a second project to develop a deep-water container terminal in the greater Lagos region used to be in the making at Badagry, west of the Nigerian capital with support from APMT (Maersk) and TIL (MSC), among others. While the Badagry Port and Free Zone website still claims that the project will see a 'soft launch' in 2018, things have been eerily quiet on the Badagry front and the project does not appear to make progress as planned. Currently, it is not clear if and when a (downscaled?) port at the site could come on stream. In either case, TIL already controls a deepwater transhipment port in Togo, at Lome, whereas APMT controls the Lagos-Apapa Terminal in Nigeria. ATI Manila adds cranes - posts strong results for 2017 Asian Terminals Incorporated (ATI), the operator of Manila's South Harbour Container Terminal, recently received two new ship-to-shore cranes from ZPMC. The Chinese-built gantries were delivered earlier this month aboard the heavy-load carrier ZHEN HUA 19 and they are expected to become operational by the end of April. Installed at API Pier 3, in the terminal's north, the cranes have a lift capacity of 70 tons and they will enable the terminal to accommodate bigger container vessels and offer faster turnaround times. The crane delivery is coordinated and timed to coincide with additional improvements at ATI, as new container yard expansions will soon come on stream in the Manila South Harbour. The new cranes are part of an upgrade program that will increase the capacity of ATI from today's 1.25 Mteu to at least 1.40 Mteu annually in 2019, compared to actual throughput of around 1.10 Mteu in ATI is located in the southern port of Manila, south of the Pasig River. map: Alphaliner In addition to the aforementioned 1.10 Mteu at Manila, ATI counted 0.20 Mteu of containers at Batangas Container Terminal, an increase of more than 25% from the previous year. Traditionally divided into the South and North ports, Manila actually Page 15 Copyright Alphaliner

16 PORT UPDATES The transport vessel ZHEN HUA 19 delivers two large new ship-to-shore cranes to the ATI Terminal at Manila South Harbour. The cranes are scheduled to become operational at the end of the month. photo: ATI has three main container port areas: While the southern port (ATI) and the central port (the ICTSI-controlled MICT) handle most international traffic, Manila North Harbour Port Incorporated focuses on domestic operations. The terminal's client base includes Philippine Span Asia Carriers, Lorenzo Shipping, Oceanic Container Lines, NMC Container Lines, Negros Navigation, MCC Transport and others. Traditionally only comprised of general cargo berths, the northern port gradually evolved to incorporate modern container facilities as well. Based on numbers of the Philippine Ports Authority, Manila and the North Luzon ports handled a volume of 4.83 Mteu in 2017, an all-time record for the region and Metro Manila. The stock-listed ATI posted a solid performance in 2017, backed by record cargo volumes at is terminal locations in Manila and Batangas. In a disclosure to the Philippine Stock Exchange, ATI said revenues last year went up 14.6% to PHP 10.6bn from PHP 9.2bn in ATI stated that, in addition to higher container volumes, a more favourable cargo mix in the non-containerized segment contributed to the result. Net income reached PHP 2.5bn up 30.7% from Asian Terminals Incorporated (ATI) is a joint venture of various local companies and investors with DP World of Dubai, UAE. The Emirati port operations giant controls a 50.54% share in the terminal, but states that ATI is not treated as a subsidiary, but instead as an equityaccounted investee. This is because the underlying shareholder agreement does not provide DPW with control of ATI. Eurogate posts 2017 results - launches pilot project to drive terminal automation The German Eurogate group last week presented improved earnings for the 2017 financial year. Despite container handling volumes that stagnated at 14.4 Mteu, the group generated a net profit for the year of EUR 85.2M, up 12.2% from the EUR 75.9M of According to Eurogate, this 'gratifying result' is due to non-recurring effects and significantly improved income from investments. Revenue fell by 4.9% EUR to reach 607.9M, compared to EUR 639.4M in The decrease primarily results from the drop in handling volumes at Page 16 Copyright Alphaliner

17 PORT UPDATES the group's Hamburg terminal, where box throughput (1.69 Mteu in 2017) dropped by 25.6% year-on-year, primarily as the facility was adversely affected by the recent carrier alliance restructurings, which favoured its local rival HHLA. Eurogate Hamburg suffered some bad luck in recent years when the traditionally strong client Hanjin Shipping went bankrupt and when other Eurogate clients, such as UASC and CSCL, were absorbed into Hapag-Lloyd and COSCO, respectively. On the plus side, Hyundai Merchant Marine will be making a comeback and it will call at the terminal with its new standalone Asia to Europe loop, which could be a precursor of bigger things to come. As far as Eurogate's other German locations are concerned, Bremerhaven remained stable at 5.54 Mteu (+0.9%), while Wilhelmshaven handled a modest 0.55 Mteu (+15.1%), roughly one fifth of the terminal's planned design capacity. This has some potential for improvement this year, as the terminal gained a call from the Ocean Alliance's NEU1 in mid JWP Wilhelmshaven to be used for Eurogate s Automation Test Given the low utilization at Wilhelmshaven, Eurogate has decided to use the vacant northern berths and storage yard areas at its Jade- Weser Port and launch a project under which the operator plans to test new methods of terminal automation. In particular, the Wilhelmshaven container terminal is being used as a testing ground for automated straddle carriers. The long-term idea behind this is to increase efficiency of the group's terminals without having to resort to costly installations such as automated container storage yards served by rail-mounted gantry cranes and AGV. Late in 2017, the equipment and systems provider Kalmar has won the tender to provide four automated straddle carriers and deliver an emulation system for the container terminal. More in-depth coverage of this week s main events in the port and terminal sector can be found on our website at: Our platform also includes a vast archive with thousands of news articles related to events and developments in the global container terminal market. Eurogate explained that the pilot project, carried out in cooperation with its joint venture partner APMT, was 'designed to prove that automated straddle carrier technology is fully functional, safe and ready for roll-out'. The first Kalmar vehicles will be delivered in the fourth quarter of After completion of the pilot project in mid-of 2019, Eurogate plans to whether and at which sites to deploy the automated straddle carrier system. Page 17 Copyright Alphaliner