Service patterns undergo adjustment

Wednesday, 26 November 2008

HUGE potential on the African continent is still far from being adequately realised, but there have at least been encouraging signs of late, with economic growth in some countries spurred by foreign investment and high prices for certain commodities.

In particular, the soaring oil price has been a major shot in the arm for Nigeria and the countries of Southwest Africa, and oil-related business has boosted trade, with the prospect of even stronger trade flows once the wealth spreads across their economies.

While Asian countries – and primarily China – have been responsible for a lot of investment and have taken a growing share of the regional market, it appears that there has been a modest increase in West African demand for European exports.

Freight rates are understood to have slipped a little lately, and with the Europe West Africa Trade Agreement (EWATA) set to close in mid-October under new legislation governing the European liner trades, the outlook on this side is not particularly bright.

There has been no reduction in container capacity by shipping lines on the European route, although there have been plenty of changes, including frequent adjustments to the pattern of services and few of the operations listed in the table of liner services have escaped. A brief round-up should be useful for readers.

The largest single network in the West African trade is that of Maersk Line and sister company Safmarine, which includes several loops based on its hub ports near Gibraltar (Algeciras, Málaga and more recently Tangier) to channel traffic from Europe and most of the rest of the globe to the region.

The network has been restructured twice in the past year, and has also been scaled back a little, mainly because of the upgrading of its direct Far East/West Africa services - a significant proportion of this business was previously handled by transshipment to the European strings.

The WAF6 loop is the only one to call direct in north Europe, including Felixstowe, A direct service is currently provided to Apapa (Lagos) and Douala, the southbound call at Abidjan having been dropped recently. Six ships are used, three provided by each line, and Safmarine is in the process of introducing brand new 2,500teu ships with a practical loading capacity of around 1,800teu.

All other major destinations are served from the UK by off-loading cargo from the WAF6 ships at Algeciras, and the exact distribution of calls between loops is shown in the main table. Some ports require a second transshipment, with Abidjan, Pointe Noire and Mindelo (Cape Verde) the secondary hubs.

It should be noted that Maersk and Safmarine frequently tinker with the network, and the most recent changes created a new loop to Abidjan, Tema and Dakar that had not made it to the trade lane schedules on their websites at the time of writing, and which consequently has just been referred to here as the ‘new loop’. Liner Analysis understands that this will deploy quite large ships, including one of 3,400teu nominal (2,300teu practical) capacity – the largest containership ever used on the Europe/West Africa route.

The main rivals of Maersk/Safmarine do not have a large enough share of the West African trades to enable them to use such large ships, although Mediterranean Shipping (MSC) was expected to bring a 2,500teu vessel into its north European service in June.

MSC is a relative newcomer to West Africa, but in its few years has built a formidable network. The direct service from Felixstowe and the north continent – only set up in October 2006 – now includes direct calls at Tema, the two Lagos facilities (Apapa/Tin Can Island) and Abidjan, with a call at Las Palmas for relaying to other destinations in the Senegal/Cameroon range.

Two other direct services set up at around the same time – one by China Shipping (CSCL) and Zim, the other by Hapag-Lloyd – have now merged, with the latter talking slots on the Zim/CSCL 12-day operation. This also provides a direct service from the UK, connecting Felixstowe to Dakar, Tin Can Island, Tema and Abidjan.

Felixstowe is also the UK base for the three other direct containerised operations to West Africa – the two loops of Delmas/OT Africa Line (OTAL)/MOL, and the SAILS venture.

SAILS has come under the majority control of Lonrho, and currently calls at Dakar and Tema on the way to South Africa, although it has also called at Abidjan and Tin Can Island recently. Four 1,100teu ships are deployed on an approximate fortnightly frequency.

Delmas and OTAL both now form part of the CMA CGM group, which has given the pair a welcome shot in the arm. The two share ships on five slings (including the ro-ro service covered below), of which the two main ones also enjoy the participation of MOL. These are the ‘Hebdo’ (Weekly) operation, which uses five 2,200teu ships purpose-built for it back in 2002-2003, and the Nigeria Express, which operates every nine days. MOL markets the two as ARX and ARE respectively.

The two other Delmas/OTAL services cover the niche markets of the ‘Northern Range’ (Dakar, Banjul, Freetown and Monrovia) and Angola (Luanda), but both only call at a single continental port – the latter at Antwerp every 10-11 days, and the former fortnightly at Zeebrugge, having recently moved from Le Havre.

The growing importance of Angola is a notable feature of the West Africa trade, and most lines now tend to serve the country on dedicated loops due to chronic congestion at Luanda, its main gateway. Sadly, none of these operations offers a direct link from the UK, although the major lines do provide controlled relay service within their networks.

Thus, Maersk and Safmarine cover Luanda via Algeciras on their WAF5 string, and MSC serves Luanda and Lobito by transhipping at Cape Town or Durban from its South Africa service (see Part 1 of text).
One line that has long specialized in the Angolan market is NileDutch, primarily through a ro-ro/multi-purpose operation. However, it has recently upgraded a low-frequency back-up string into a fully-fledged container service, with sailings every 13 days on average – on some sailings ships call at Antwerp, although on others they turn in Portugal.

The NileDutch ro-ro operation has not been affected by this build up, and still offers sailings from the north Continent every eight-to-nine days.

Also covering Angola through a ro-ro multi-purpose service is Grimaldi Lines, on its Southern Express (SEX) loop. This has been streamlined recently, with some of its other ports of call switched to a new string known as Eurocargo Express (ECS), allowing more space to be used for the Angolan market.
Grimaldi now operates four loops to the region, covering a highly impressive array of ports. While only two (the eight-day CEX and 9-10 day NEX), include UK calls, both at Tilbury, cargo can be transferred between vessels at either Antwerp or Dakar – ports that feature on all four strings.

Finally, mention must also be made of Baco-Liner, whose three barge/container carriers sail from the UK (either Tilbury or Liverpool) to Lagos, Port Harcourt and Takoradi around twice a month.
A number of other multi-purpose services that accept containers and may be of interest to readers are listed in Part Three.

As usual, the performance of shipping lines in the West African trades has been undermined by congestion at many ports. While Lagos has improved no end, with the dire situation at Apapa now overcome (largely thanks to new procedures and the provision of new equipment under the management of APM Terminals), others have gone from bad to worse.

At the time of writing, EWATA was imposing surcharges at 11 ports ranging from £40 per teu (£80 per feu) at Onne to £315 per teu (£630 per feu) at Luanda, where containership visits are running into weeks. The other ports on which surcharges are imposed, from highest to lowest, are: Bata, Lobito, Malabo, Matadi, Dakar, Cotonou, Pointe Noire, Tema and Lomé.

The appearance of several key ports in this list helps to explain why shipping lines have had such a difficult job keeping to a reasonable schedule.

This is particularly true of operations that are scheduled on a fixed-day pattern, which include the containerised loops of Maersk/Safmarine and MSC, and the Hebdo loop operated by Delmas and OTAL in association with MOL.

Of these, only the three direct operations could be monitored – the Maersk/Safmarine WAF6, Delmas/OTAL/[MOL] Hebdo and MSC north Europe loop – but none managed to average less than two days behind their long-term pro forma schedules during the survey window, leaving the Star Performer slot unfilled.

The Hebdo was the best of the three, and its operators were unlucky in this respect to have ended up with an average of just over two days. In several cases, actual arrival dates were not available for two of the base ports, Dakar and Tema, but there is no reason to believe that the overall averages would have been much different from those listed in the table.

Apart from the problems in West African ports, Delmas/OTAL, MSC and Maersk/Safmarine appear to have had a few delays at Felixstowe. MSC opted to skip the port five times in the survey window to avoid problems, and Maersk/Safmarine on one occasion.

Overall, Maersk and Safmarine had a rather disappointing result for the WAF6, and a close look reveals that a major cause of frustration was Algeciras, which has suffered hugely from the sheer volume of transshipment business moving across its quays.

This has also affected the relay loops, most of which have been calling at either Málaga or more recently at the new Tangier Med facility, as an alternative hub. The increasing use of these ports, and amendments to calling patterns on the various loops, will hopefully alleviate the problems.
Whatever the outcome, Maersk/Safmarine had a pretty miserable time during the monitoring period, and WAF6 ships actually skipped Abidjan and Apapa four times each. On two occasions delays were so great that two vessels were in the same port at the same time – at Douala in early February, and at Apapa in March.

There is at least a decent array of transit times in the relevant table, with the more impressive times from the UK to our base ports spread over several operations.

To Lagos, these include Grimaldi, with the best times on its CEX loop, followed quite closely by the Delmas/OTAL/[MOL] Nigeria Express and Zim/CSCL, although the latter skipped Felixstowe on four occasions.

MSC came out on top to Tema (although five Felixstowe calls were skipped), followed by the Delmas/OTAL/[MOL] Hebdo. In both cases, however, the data for Tema was incomplete.

The Delmas/OTAL/[MOL] partnership was swiftest times to Dakar, and first and second fastest to Abidjan, and in the overall reckoning the three lines have to be ranked in top position for transit times from the UK.