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South Korea's Arctic shipping ambitions on ice due to high costs and low volumes

South Korea's Ministry of Oceans and Fisheries (MOF) is struggling to attract local shipping companies to build ice-class container ships, despite dangling $8m of subsidies. The idea was to build ice-class ships in a local shipyard in the hope of running regular liner services through the Northern Sea Route by 2030. South Korea is keen to tap the NSR as an expedited shipping lane from South Korea to Europe, following the lead of China. On 22 August, South Korean ferry operator Panstar Line executed a test voyage from Busan to Rotterdam, using the 2,758 teu Panstar Acro. However, the market uncertainties - including the key factor of attracting sufficient cargo volumes - and the high construction price of ice-class ships are discouraging shipping companies from signing up. The initial tender published by the MOF invited applications from 5 March to 26 June, but the lack of applicants made the ministry extend the deadline to 30 September. Reportedly, one local shipping company held discussions with a shipyard in hope of tendering for the vessel construction. Eventually, no application was made, due to the expensive construction and challenges in securing cargoes. Alphaliner noted in its report this week that only 737 teu was loaded on the Panstar Acro, failing to meet expectations of filling at least half the ship, despite Panstar Line holding extensive sales talks with shippers and 3PL companies. "On Saturday, the Panstar Acro reached the UK port of Felixstowe, three weeks after leaving its start port of Busan. It marks the halfway point of its voyage. "The ship will also return to South Korea via the Arctic route, with the round trip expected to take about 45 days," the analyst said. The South Korean government targets to have regular liner operations through the Arctic by 2030, although MOF is reportedly still reviewing the number of ships required for permanent operations during the NSR navigational season. In another effort to reach out to ship owners, national shipping financial institution Korea Ocean Business Corporation held a briefing session last week, with officials saying they wanted to understand the difficulties perceived by shipping lines in operating NSR services. KOBC officials said that if no applications are received this year, it would become harder to get more funding to attract more shipping lines in subsequent years.

Ethiopian Cargo places its capacity on the CargoAi portal

Ethiopian Airlines Cargo has placed its capacity with online booking portal CargoAi as part of efforts to enhance its digital services and expand its customer base. The new partnership means Ethiopian will be able to offer e-booking of its flights with real-time rate visibility to the freight forwarder users of CargoAi's CargoMART portal. Its capacity will also appear on those transport management systems that have connected to the CargoAi system. "Through this integration, more than 30,000 freight forwarders across Europe, Africa, the Middle East and Asia gain seamless access to Ethiopian Cargo's general cargo and express services," CargoAi said in a press release. The integration will also allow Ethiopian Cargo to leverage CargoAi's interline capabilities for services on partner airline flights. "Digitalisation is a key pillar of Ethiopian Cargo's long-term strategy," said managing director of Ethiopian Cargo and Logistics Services, Dereje Derero. "Partnering with CargoAi allows us to bring our services closer to freight forwarders worldwide by offering a modern, seamless booking experience. "This step reinforces our commitment to innovation and to delivering agile, data-driven solutions that meet the evolving needs of the global air cargo industry." CargoAi chief executive Matthieu Petot added: "Ethiopian Cargo is a global leader in air cargo operations, and this partnership reflects a shared ambition to drive digital excellence." The move is the second digital development at the airline this year. In March, Ethiopian Cargo announced that it would join WebCargo by Freightos, the digital booking and payment platform.

Asian carriers target India-East Africa trade with new dual-string service launch

Container lines are pouring more capacity into India-Africa trades that industry sources say is expanding at a strong pace as global supply chain patterns realign. Two new weekly departures from western India to East Africa are set to launch this month, adding significant loading space for Indian exporters targeting the buoyant sourcing market. These services will be operated by a cohort of Asian liners, led by Pacific International Lines (PIL), HMM, Cosco, Interasia Lines (IAL), OOCL and ONE, with one service connecting JNPA (Nhava Sheva) and Mundra in India to Mombasa, Kenya, and the other to Dar es Salam, Tanzania, in East Africa, according to trade sources. Sources also said the dual-string network, named GIA1 and GIA2, is to use vessels in the range of 2,300 to 2,800 teu capacity, with each service deploying eight vessels. And the first departures at the PSA terminal (BMCT) in JNPA (Nhava Sheva) are scheduled for 23 September and 27 September, forward vessel schedules show. "The new service connects major production hubs and consumer markets across India and East Africa, responding to growing trade demand between the two regions," Singapore-based PIL said. William Ho, PIL's GM for long-haul services, said: "PIL has been serving the Asia-Africa trade for decades, building deep market expertise, strong partnerships and a trusted network across the continent. "Together with our existing services, IMX [Imara Express] provides customers with a more comprehensive network package, expanding market access with greater flexibility, and more options to optimise their supply chain needs in an increasingly dynamic trading environment," Mr Ho added. South Korean liner HMM said the new network ties in with its 'hub-and-spoke' operating strategy. "By adding the East Africa (GIA) route to its existing West Africa (MA2) service, HMM expands its coverage across the African continent. "Kenya and Tanzania, the newly added destinations, serve as gateways to East Africa, where port infrastructure and inland logistics developments are ongoing," HMM noted. "The service is expected to improve transport convenience for shippers." According to local industry sources, India-East Africa trade growth is being driven, in large part, by automotives, engineering goods and various out-of-gauge (OOG) cargo. "The capacity demand is strong," one carrier executive told The Loadstar. With growing India-Africa volumes, the freight yields on the tradelane have been quite attractive for capacity participants, according to sources. Average spot rates ex-JNPA now stand at $2,100 per 20ft and $2,400 per 40ft for Mombasa/Dar es Salaam, market participants said. However, mainliners traditionally active on India-Africa trades - particularly CMA CGM - are closely evaluating how the influx of capacity from Asian regional carriers could impact their cargo support, as newcomers typically have the appetite to undercut market rates to fill vessels. CMA CGM operates its Swahili Express (SWAX) service that connects India, the Middle East and East Africa. Meanwhile, authorities in Kenya recently tightened cargo manifest rules with a new advance cargo declaration (ACD) requirement as part of efforts to rein-in misdeclaration of goods and other trade illegalities. This updated ACD regime took effect 1 August and has already sparked compliance issues for some Indian shippers. For example, a northern India exporting firm alleged that its consignment of three 20ft boxes, shipped from Mundra to Mombasa, had been stuck at the destination for two weeks due to incorrect/flawed manifest filing by the carrier. You can contact the writer at [email protected]