Recent developments in Recent developments in container liner shippingcontainer liner shipping

Frans WaalsFrans WaalsEditor “DynaLiners”

Senior Shipping Consultant

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• Shipping Publications DynaLiners, Container Trade Studies, Special Reports

Trades and liner servicesTrades and liner services

World Container TradeWorld Container Trade

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60,000,000

80,000,000

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1980

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East West TradesEast West Trades

TPTPTPTP

TATA

E/FEE/FE

E/FEE/FE

Parallel TradesParallel Trades

TPTPTPTP

TATA

E/FEE/FE

E/FEE/FE

TP/USEC

Med/FE

Med/NA

North South TradesNorth South Trades

Lat.Am

Africa

Australasia

Mid East

ISC

TPTPTPTP

TATA

E/FEE/FE

E/FEE/FE

TP/USEC

Med/FE

Med/NA

Trade route Growth 2007 2006

Europe-Far East WB 19% 13,557,000 11,404,000

Europe-Far East EB 5% 5,349,000 5,104,000

Grand Total 15% 18,906,000 16,508,000

Transpacif ic EB 1% 12,870,000 12,787,000

Transpacif ic WB 16% 5,320,000 4,595,000

Grand Total 5% 18,190,000 17,382,000

Transatlantic WB -5% 2,596,000 2,737,000

Transatlantic EB 20% 2,124,000 1,770,000

Grand Total 5% 4,720,000 4,507,000

East West VolumesEast West Volumes

FEFC – 1Q 2008FEFC – 1Q 2008

• Westbound, 11.9% growth in the first three months

• Eastbound, 3.8% decline in the first two months

Westbound Growth Growth 1Q/08 1Q/07

Trade volumes to: % TEU TEU TEU

Europe 9.4% 131 1,525 1,394

Mediterranean 16.7% 121 846 725

Total 11.9% 252 2,371 2,119

US Trades – ExportUS Trades – Export

• US exports booming• Especially to Europe, South America, ME and Africa

Growth 2007 2006 2005 2004FE and ISC 17% 5,629 4,814 4,484 4,096Europe/Med* 20% 2,124 1,770 1,597 1,504C. America 8% 607 564 523 512Caribbean 8% 590 544 490 480WCSA 28% 337 263 236 228ECSA 18% 467 395 367 357Mid-East* 35% 303 225 273 261Africa* 39% 214 154 178 172Australasia 11% 238 214 227 226Total export 18% 10,509 8,943 8,375 7,836Grow th % - 18% 6.80% 6.90% 8.40%

US Trades - ImportUS Trades - Import

• US imports declining, after strong earlier growth• Imports twice as big as exports• Especially from South America

Growth 2007 2006 2005 2004FE and ISC -1% 13,488 13,615 12,269 10,825Europe/Med* -5% 2,596 2,737 2,536 2,479C. America 2% 706 693 659 650Caribbean -2% 145 148 141 141WCSA -7% 423 454 411 397ECSA -13% 535 612 625 608Mid-East* -8% 56 61 147 146Africa* -7% 93 100 135 135Australasia 0% 187 187 173 182Total import -5% 18,229 19,156 17,095 15,562Grow th % - -4.80% 12.10% 9.90% 13.00%

Latin AmericaLatin America

• Europe average growth, Far East strong growth• Very imbalanced trades

All Europe - Latin America Container Trade, in TEU2007 2006 2005

Europe-Latam 1,340,000 1,309,000 1,240,000Latam-Europe 2,790,000 2,595,000 2,427,000Total trade 4,130,000 3,904,000 3,667,000Growth 6% 6%

Far East - Latin America Container Trade, in TEU2007 2006 2005

Far East-Latam 1,951,000 1,749,000 1,447,000Latam-Far East 934,000 885,000 811,000Total trade 2,885,000 2,634,000 2,258,000Growth 10% 17%

Indian Sub ContinentIndian Sub Continent

• Strong growth• Europe-ISC – balanced• Far East-ISC – large imbalance

All Europe - Indian Sub Continent Container Trade, in TEU2007 2006 2005

Eastbound to ISC 603,000 565,000 531,000Westbound to Europe 797,000 707,000 646,000Total trade 1,400,000 1,272,000 1,177,000Growth 10% 8%

Far East - Indian Sub Continent Container Trade, in TEU2007 2006 2005

Northbound to Far East 739,000 665,000 595,000Southbound to ISC 1,234,000 1,127,000 1,013,000Total trade 1,973,000 1,792,000 1,608,000Growth 10% 11%

Middle EastMiddle East

• Average growth rates• Significant Imbalances

All Europe - Middle East Container Trade, in TEU 2007 2006 2005

Eur-ME 2,111,000 2,024,000 1,922,000ME-Eur 1,499,000 1,404,000 1,343,000Total trade 3,610,000 3,428,000 3,265,000Growth 5% 5%

Far East - Middle East Container Trade, in TEU 2007 2006 2005Far East-ME 3,436,000 3,152,000 2,748,000ME-Far East 1,230,000 1,160,000 910,000Total trade 4,666,000 4,312,000 3,658,000Growth 8% 18%

AustraliaAustralia

• Average growth rates• Balanced trades• Low volumes

All Europe - Australasia Container Trade, in TEU2007 2006 2005

Europe-Australasia 292,000 286,000 283,000Australasia-Europe 268,000 241,000 220,000Total trade 560,000 527,000 503,000Growth 6% 5%

Far East - Australasia Container Trade, in TEU2007 2006 2005

Southbound to Australasia 993,000 921,000 817,000Northbound to the Far East 911,000 856,000 803,000Total trade 1,904,000 1,777,000 1,620,000Growth 7% 10%

AfricaAfrica

• Europe average growth, Far East fairly high growth• Huge imbalances

All Europe - all Africa Container Trade, in TEU 2007 2006 2005

Europe-Africa 1,660,000 1,566,000 1,434,000Africa-Europe 872,000 830,000 852,000Total trade 2,532,000 2,396,000 2,286,000Growth 6% 5%

Far East - all Africa Container Trade, in TEU2007 2006 2005

Far East-Africa 1,537,000 1,355,000 1,182,000Africa-Far East 593,000 562,000 520,000Total trade 2,130,000 1,917,000 1,702,000Growth 11% 13%

East West Service developmentsEast West Service developments

• Transpacific– Reduction of number of services– More carriers cooperating through vessel sharing agreements– Long winter season, much temporary capacity reduction

• Transatlantic– Reduction of number of services– Cooperating through vsa or slot charter agreements– Some carriers withdrawing completely

• Europe/Mediterranean – Far East– Increasing number of services– Use of larger vessels– Introduction of mega container ships (10/15,000 TEU)– Focusing on serving specific areas (e.g. Black Sea)– Introducing more ships per service to save on fuel costs

North South Service developmentsNorth South Service developments

• Latin America– Overcapacity– Carriers cooperating or withdrawing altogether

• Indian Sub Continent– (Too?) many new services launched

• Middle East– More direct services– Many feeder services

• Australasia– Restructuring - new services started, existing disappearing (Far East trade)– Many vessel sharing agreement

• Africa– Dedicated services to north coast from Far East,

through transshipment in Med

PortsPorts

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Port HandlingsPort Handlings

Multi-MillionairesMulti-Millionaires

• Shanghai to become world’s largest container port this year??• Hong Kong stagnating, to be overtaken by Shenzhen soon• Dubai Soaring• Kaohsiung overtaken by other ports

Growth 2007 TEU 2006 TEU

1 Singapore 9% 27,000 24,800

2 Shanghai 20% 26,200 21,700

3 Hong Kong 2% 23,900 23,500

4 Shenzhen 13% 20,900 18,500

5 Busan 10% 13,300 12,000

6 Dubai 23% 11,000 8,900

7 Rotterdam 12% 10,800 9,600

8 Kaohsiung 4% 10,200 9,800

Total 11% 143,240 128,800

(TEU*1,000, rounded)

ChinaChina

• All ports reporting strong growth• Even “smaller” port handle multi-million TEU

Ports Growth Growth 2007 2006

% TEU TEU TEU

Shanghai 20% 4,358 26,150 21,792

Shenzhen 14% 2,591 21,099 18,508

Qingdao 23% 1,769 9,462 7,693

Ningbo 32% 2,269 9,360 7,091

Guangzhou 39% 2,581 9,200 6,619

Tianjin 19% 1,134 7,103 5,969

Xiamen 15% 604 4,627 4,023

Dalian 19% 609 3,813 3,204

Lianyungang 54% 702 2,001 1,299

Yingkou 36% 363 1,371 1,008

Other 20% 3,020 17,814 14,794

Total 22% 20,000 112,000 92,000

(TEU*1,000, rounded)

HLH rangeHLH range

• Le Havre and Zeebrugge record strong growth• Other ports growing respectable 10-15% increases

Port ’07/’06 2007 2006 2005

growth TEU TEU TEU

Hamburg 12.20% 9,940 8,862 8,088

Bremerhaven 10.30% 4,900 4,444 3,736

Rotterdam 12.50% 10,800 9,600 9,287

Antw erp 16.00% 8,140 7,019 6,488

Zeebrugge 24.40% 2,040 1,640 1,408

Le Havre 21.10% 2,600 2,130 2,057

Total 14.00% 38,420 33,695 31,064

Grow th - 14.00% 8.50% 10.40%

(TEU*1,000, rounded)

US West CoastUS West Coast

• Overall stagnating• Imports stabilizing• Exports booming• Empties significantly reduced

Ports Growth 2007 TEU 2006 TEU

Long Beach 0.30% 7,312 7,290

Los Angeles -1.40% 8,355 8,470

Oakland -0.10% 2,388 2,392

Seattle -0.50% 1,628 1,636

Tacoma -9.60% 1,401 1,552

Total -1.20% 21,087 21,340

- of which full in Growth 2007 TEU 2006 TEU

Long Beach 0% 3,705 3,720

Los Angeles 0% 4,410 4,408

Oakland -1% 868 878

Seattle 1% 810 799

Tacoma -7% 694 746

Total -1% 10,487 10,551

- of which full out Growth 2007 TEU 2006 TEU

Long Beach 22% 1,574 1,291

Los Angeles 13% 1,608 1,424

Oakland 9% 913 840

Seattle 15% 504 439

Tacoma 21% 446 368

Total 16% 5,044 4,362

- of which empty Growth 2007 TEU 2006 TEU

Long Beach -11% 2,034 2,280

Los Angeles -11% 2,337 2,638

Oakland -10% 607 674

Seattle -21% 314 398

Tacoma -40% 263 438

Total -14% 5,556 6,428

US West Coast - 1Q 2008US West Coast - 1Q 2008

• Imports falling• Exports double-digit growth

- of which full in Growth 1Q08 1Q07Long Beach -11% 753 841Los Angeles -7% 958 1,031Oakland -6% 189 201Seattle -3% 172 177Tacoma -10% 159 177Total -8% 2,231 2,428

- of which full out Growth 1Q08 1Q07Long Beach 16% 432 342Los Angeles 23% 457 371Oakland 11% 236 212Seattle 7% 126 117Tacoma 13% 129 114Total 19% 1,379 1,157(*1,000 TEU)

US East CoastUS East Coast

• Still growing• Significant differences by port

Port Growth 2007 2006 2005 2004

NYNJ 3% 5,299 5,128 4,793 4,478

Savannah 21% 2,605 2,160 1,902 1,662

Virginia Ports 5% 2,128 2,030 1,982 1,809

Charleston -11% 1,750 1,968 1,987 1,864

Houston 10% 1,769 1,606 1,582 1,438

Miami -9% 885 977 1,054 1,010

16,442 15,876 15,305 14,264

4% 4% 7%

(*1,000 TEU)

First 2008 developmentsFirst 2008 developments

• China– Continues fast growth

• Europe– Modest growth (Antwerp and Rotterdam 6%)

• USWC– Export booming, import declining, trade imbalance reducing

• USEC– No figures available

Carriers and their fleetsCarriers and their fleets

Carrier fleet sizeCarrier fleet size

Rank Parent/02/08 main company Ships TEU Ships TEU Share

1 Maersk Line 535 1,932,000 84 405,000 21%2 MSC 373 1,234,000 62 636,000 52%3 CMA CGM 377 895,000 76 605,000 68%4 Evergreen 177 625,000 11 110,000 18%5 Hapag-Lloyd 139 497,000 11 96,000 19%6 China Shipping 140 434,000 40 249,000 57%7 Coscon 141 431,000 60 391,000 91%8 APL 125 403,000 39 261,000 65%9 NYK 118 386,000 41 222,000 58%

11 Hanjin 84 350,000 41 308,000 88%12 MOL 111 347,000 34 184,000 53%13 K" Line 93 308,000 35 169,000 55%14 ZIM 113 290,000 41 290,000 100%

2,526 8,132,000 575 3,926,000 50%

OrderbookOperated fleet

Fleet size comparedFleet size compared

Rank Parent/02/08 main company % TEU Ships TEU Ships TEU

1 Maersk Line 411% 1,554,000 535 1,932,000 182 378,0002 MSC 519% 1,034,800 373 1,234,000 123 199,2003 CMA CGM 672% 779,000 377 895,000 73 116,0004 Evergreen 110% 328,000 177 625,000 141 297,0005 Hapag-Lloyd 397% 397,000 139 497,000 38 100,0006 China Shipping 2793% 419,000 140 434,000 33 15,0007 Coscon 90% 204,000 141 431,000 155 227,0008 APL 104% 205,000 125 403,000 76 198,0009 NYK 135% 222,000 118 386,000 78 164,000

11 Hanjin 50% 117,000 84 350,000 80 233,00012 MOL 169% 218,000 111 347,000 67 129,00013 K" Line 191% 202,000 93 308,000 50 106,00014 ZIM 154% 176,000 113 290,000 67 114,000

257% 5,855,800 2,526 8,132,000 1,163 2,276,200

10 year growth 2008 Fleet 1999 Fleet

Hapag-Lloyd 14CP Ships 2005

CP Ships Italia 2002

CP Ships Americana Ships 2000

CP Ships CCAL 2000

CP Ships TMM Lines 2000

CP Ships TMG 1999

CP Ships ANZDL 1998

CP Ships Ivaran Lines 1998

CP Ships Contship 1997

TMM CTE 1997

TMM FMG (TMG) 1997

CP Ships Lykes Lines 1997

CP Ships Cast 1993 1995

TMM Tecomar 1994

A.P. Møller-Maersk (Maersk Line) 18Norse Merchant 2005

Royal P&O Nedlloyd 2005

P&O Nedlloyd, Royal P&O Nedlloyd 2004

SCF Oriental Lines 2004

Torm Lines 2002

P&O Nedlloyd Farrell Lines 2000

P&O Nedlloyd Harrison (Latam) 2000

Safmarine SafBank 2000

P&O Nedlloyd Harrison (East Africa) 1999

Safmarine & CMBT 1999

Sea-Land 1999

P&O Nedlloyd ANL Europe Services 1998

Safmarine Barbican (parts of) 1998

P&O Nedlloyd Blue Star (Asia) 1998

Safmarine CMBT 1998

Safmarine Safmarine & CMBT 1998

P&O Nedlloyd Tasman Express Line 1998

EAC 1993

ConsolidationConsolidation

CMA CGM 13US Lines US Lines 2007

CoMaNav CoMaNav 2007

Cheng Lie Cheng Lie 2007

Delmas Delmas 2005

Dextramar 2005

MacAndrew s (Iberian) 2003

United Baltic Corp. 2003

Delom SA 2002

Delmas Setramar 2001

Delmas Med./Latam 1999

Delmas OTAL 1999

CGM ANL Far East Services 1998

CGM 1996

APL (NOL) 1American Pres. Line 1997

Evergreen 2Uniglory 2002

Lloyd Triestino 1998

Hanjin 1DSR-Senator 1997

Total annual liftingsTotal annual liftings

Capacity Liftings Parent/ 2007 2006 2006 2005ranking ranking main company TEU (est.) Share % TEU TEU

1 1 Maersk Line 14,500,000 12% 13,320,000 13,096,0002 2 MSC 10,000,000 7% 8,250,000 6,500,0003 3 CMA CGM 7,240,000 6% 6,448,000 5,670,0004 4 Evergreen 6,200,000 5% 5,700,000 5,000,0006 5 China Shipping 6,630,000 5% 5,568,000 4,597,0008 6 Coscon 5,800,000 5% 5,110,000 4,535,0005 7 Hapag-Lloyd 5,500,000 4% 5,004,000 4,876,0008 8 APL 4,714,000 4% 4,193,000 3,891,000

11 9 Hanjin 4,300,000 3% 3,904,000 3,529,0009 11 NYK 3,800,000 3% 3,533,000 3,260,000

13 12 "K" Line 3,300,000 3% 2,938,000 2,650,00012 13 MOL 3,200,000 3% 2,850,000 2,351,00014 20 ZIM 2,400,000 2% 2,071,000 2,041,000

77,584,000 61% 68,889,000 61,996,000Figures in italics are estimates

Liftings by East West Trade (2006)Liftings by East West Trade (2006)

Rank TEU Share TEU Share TEU Share TEU ShareMaersk Line 1 6,510,000 17% 2,440,400 14% 625,100 15% 3,444,500 21%MSC 2 3,104,200 8% 854,600 5% 604,300 14% 1,645,300 10%Evergreen 3 3,071,000 8% 1,737,700 10% 268,400 6% 1,064,900 6%Hanjin 4 2,606,000 7% 1,556,200 9% 134,700 3% 915,100 6%CMA CGM 5 2,340,700 6% 642,800 4% 138,600 3% 1,559,300 9%Hapag-Lloyd 6 2,047,700 5% 529,800 3% 692,000 16% 825,900 5%Coscon 7 1,986,900 5% 1,048,600 6% 113,500 3% 824,800 5%APL 8 1,924,900 5% 1,155,600 7% 214,600 5% 554,700 3%China Shipping 9 1,780,000 5% 875,900 5% 149,300 3% 754,800 5%"K" Line 12 1,618,300 4% 876,200 5% 92,400 2% 649,700 4%NYK 13 1,605,500 4% 894,600 5% 102,300 2% 608,600 4%MOL 15 1,140,700 3% 647,700 4% 69,100 2% 423,900 3%ZIM 16 704,100 2% 211,900 1% 159,700 4% 332,500 2%

Global 13 30,440,000 80% 13,472,000 78% 3,364,000 79% 13,604,000 82%Grand total 38,084,800 100% 17,292,100 100% 4,267,100 100% 16,525,500 100%

Europe-Far EastCarriers (main company)

East-West Transpacific Transatlantic

Current ships size and order bookCurrent ships size and order book

Size (TEU)Category Ships TEU Ø TEU>7,500 190 1,671,000 8,800 >5,000 413 2,415,000 5,800 >4,000 401 1,780,000 4,400 >3,000 315 1,072,000 3,400 >2,000 693 1,749,000 2,500 >1,000 1,190 1,674,000 1,400 >100 1,150 696,000 600 Total 4,352 11,057,000 2,500

Operated fleetShips TEU Ø TEU

330 3,530,000 10,700 177 1,084,000 6,100 256 1,121,000 4,400 72 248,000 3,400

155 401,000 2,600 305 439,000 1,400 144 119,000 800

1,439 6,942,000 4,800

Orderbook OrderbookShare

211%45%63%23%23%26%17%63%

Forecasted Fleet GrowthForecasted Fleet Growth

Assuming no scrapping!

GrowthYear Ships TEU Year Ships TEU %

2007 3,950 9,578,000 2007 368 1,345,000 14.0%2008 4,318 10,923,000 2008 503 1,636,000 15.0%2009 4,821 12,559,000 2009 415 1,720,000 13.7%2010 5,236 14,279,000 2010 324 1,838,000 12.9%2011 5,560 16,117,000 2011 165 1,270,000 7.9%2012 5,725 17,387,000 2012 77 710,000 4.1%

Existing fleet as of 1 January Deliveries during the year

ULCS (10,000+ TEU)ULCS (10,000+ TEU)

Rank Operator Ships Ø TEU Total TEU

10 APL 8 10,400 83,0006 China Shipping 8 13,300 106,0003 CMA CGM 30 11,900 357,0007 Coscon 12 12,100 145,000

15 CSAV 8 12,600 100,0004 Evergreen 8 12,500 100,0009 Hanjin 16 11,500 185,000

18 Hyundai 5 13,100 65,0001 Maersk Line 22 13,000 286,0002 MSC 35 12,300 431,000

16 ZIM 17 11,400 194,000

All operators 169 12,100 2,053,000

All non-operating owners 42 12,400 521,000

Grand total 211 12,200 2,574,000

Overall investment USD 33 billion

Freight and costsFreight and costs

• Freight– USD falling – some carriers switching to Euro onspecific trades

– Revenues increasing, though very trade related

– Surcharges

• Cost– Fuel costs are rocketing (>USD 500/tonne)

– Charter hire increased, but more or less stabilised

THANK YOU!THANK YOU!

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