Shipping firm rejigs hub concept

By YOKE HAR LEE

Chinese-owned shipping firm Cosco New Zealand will abandon its Sydney and Brisbane hubbing concept introduced last year, rejigging the service less than eight months after its debut.

Next month Cosco will have a dedicated fleet of six vessels offering fixed-day services from Yokohama, Kobe, Pusan, Hong Kong, Manila, Auckland, Lyttelton, Nelson and fortnightly at Tauranga and New Plymouth, the latter a new port of call.

Early last year, Cosco Shanghai decided there was a need to rationalise some of its global operations to introduce a new fleet and to redistribute its fleet for other trades.

That decision resulted in the introduction last May of a New Zealand-Australia-Japan service with a hub northbound at Brisbane and southbound at Sydney.

In February last year, the company also dropped Tauranga and Napier as ports of call. It decided later to reinstate Tauranga and also to use Napier.

Before that, Cosco had two separate fleets - one to service a fixed-day weekly New Zealand-Japan service, and another for Hong Kong, Taiwan and the Philippines.

General manager Stuart Ferguson told the Business Herald that while the service using Sydney and Brisbane as a hub exceeded the company's expectations, Australia had high transfer costs.

"There has been little doubt that a dedicated service in New Zealand, bypassing Sydney and Brisbane, would be preferable.

"We decided it [the Sydney-Brisbane hub] was not producing the types of savings we had anticipated because of the high transfer cost in Sydney and Brisbane."

The new service, he said, would reduce transit times between Japan and Korea by up to four days.

"It also allows us to maintain reduced transit time to Hong Kong by several days and allows us to reintroduce a direct call at Manila. Overall transits into other destinations served over the hubs of Kobe, Pusan and Hong Kong are reduced by between two to four days."

The new move allowed for the Sino-Australian service to be combined with the New Zealand-Hong Kong service. This reduced the number of vessels used yet met the demands of Australasian clients.

Mr Ferguson said he expected Cosco to get a share of the Dairy Board cargo through New Plymouth when the company started its fortnightly call there.

In terms of the volume outlook for carriers, he said exporters were seeing a slow recovery, while importers were not wavering in terms of what they expected to bring into New Zealand.

The Asian market was also showing signs of recovery.

"Stability in Asia's political scene is what will drive New Zealand's export recovery. And stability appears to be in place with the exception of Indonesia and Malaysia."

Cosco New Zealand is part of Cosco Container Lines, a part of China's Chinese Ocean Shipping Company which has operations in 38 countries.