Home » Maritime » International lines cutting deep into local carriers’ business

Local shipping lines are reeling from competition resulting from more direct calls of international carriers, particularly in Visayas and Mindanao.

The lines point to additional vessels deployed by MCC Transport — the joint venture carrier between Aboitiz Transport System and the world's biggest container line Maersk — as eating up a significant portion of the local cargo market.

Based on latest data from Solid Shipping Lines, the volume of local cargo carriers (specifically transit cargoes bound for the international trade) has been reduced by at least 10%. These products include food items, groceries, bananas, pineapples, woodcraft and handicrafts, tuna, cereals.

Shippers – particularly exporters – now prefer to ship with international shipping lines calling in Cebu, Davao and the Mindanao Container Terminal to save on transshipment cost.

The most affected by competition are the two Magsaysay-owned carriers Lorenzo Shipping Lines and NMC Container Lines, Oceanic Container Lines, and Solid Shipping Lines. Each of these lines carries an annual average of 100,000 twenty-foot equivalent units (TEUs). But with the influx of more direct calls, only 85,000 to 90,000 TEUs will likely be handled each year.

The lines said the reduction in cargo volume could have been higher if not for strong imports.

In the first nine months of the year, domestic cargo volume grew 8% to 1.243 million TEUs from 1.151 million TEUs year on year.

Export volume increased 23.2% from 856,639 TEUs to 1.055-million TEUs.

The volume of shipcalls, meanwhile, also went up 10.65% from 232,701 in 2009 to 257,483 this year. Both domestic and foreign vessels rose 10.67% and 9.99%, respectively.

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