Global shipping services and New Zealand ports may experience changes following a collaboration between Hapag Lloyd and Maersk. The two operators have launched Gemini Cooperation, operational since February 1, involving 340 vessels on seven major trade routes, supported by feeder services.
The collaboration aims for 90% customer service reliability, a notable increase from the current sub-50% levels on certain routes. The potential impact on New Zealand ports and exporters remains uncertain. Mike Knowles, chair of the NZ Council of Cargo Owners, suggested Gemini ships might call at one hub per island, utilizing feeder services to manage cargo from smaller ports. He noted that global shipping services have not yet returned to pre-COVID reliability, and New Zealand ports are similarly lagging in efficiency, with Ports of Auckland facing particular challenges.
Despite the potential for longer transit times due to more hub stops, Knowles acknowledged the focus on reliability could offer exporters greater certainty. "The aim is to improve the reliability of the global network, and if it does that, it will be beneficial for NZ exporters," he stated.
Andy Bowley, Forsyth Barr's head of research, indicated that the collaboration seeks to leverage Maersk's port network to enhance shipping reliability. He noted that ports are already centralizing around hubs, and with the introduction of Gemini, collaborating shipping lines now represent over 80% of global shipping. Bowley expressed skepticism about any major service shifts affecting New Zealand, given Gemini's primary focus on east-west and west-east routes. "I am not convinced we are going to see a seismic shift in services to and from NZ," he commented.
The introduction of Gemini may heighten competition and influence shipping rates, which rose sharply during the COVID period and again last year. According to the Global Container Freight Index, shipping a 40-foot container cost US$3300 last November, up US$1200 from January 2023.
The Gemini trade lanes span Asia-US West Coast, Asia-US East Coast, Asia-Middle East, Asia-Mediterranean, Asia-North Europe, Middle East-India-Europe, and Transatlantic routes. Hapag Lloyd reports that the vessels can move 3.7 million TEU annually, servicing 6000 ports, and aiding decarbonization goals. Maersk cites ongoing military conflict in the Red Sea as a factor, necessitating ship rerouting around the Cape of Good Hope.
Kotahi, New Zealand's largest freight manager, previously signed a long-term freight agreement with Maersk, ensuring reliable shipping services. This follows a similar 10-year agreement starting in 2014, which facilitated the shipment of 1.8 million TEUs of New Zealand cargo, primarily dairy, meat, seafood, horticulture, and forestry.
Source: Farmers Weekly