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February 3 2020

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18 The Journal of Commerce | Februar y 3 2020 International Maritime CONTAINER LINES CALLING at southern China's key Yantian International Container Terminal (YICT) face a surge in pilotage fees, a move carriers say jeopardizes container volumes there and in Hong Kong. The charges, which took effect on Jan. 1, come as Hong Kong is already under pressure to maintain its position as one of the world's top 10 container ports amid a continual shift of volumes to nearby Chinese ports and some shift in manufacturing from China to southeast Asian nations. The imposition of compulsory pilotage services by Hong Kong's Marine Department will cost container lines calling at YICT approx- imately HK$400 million ($51.4 million) a year, Roberto Giannetta, executive director of the Hong Kong Liner Shipping Association (HKLSA), told The Journal of Commerce. "But even worse, the operational impact is affected, because the Hong Kong pilot pick-up/drop-off is not even coordi- nated with the Shenzhen pilot pick-up/ drop-off," he said. industry's second largest behind CMA CGM at 433,744 TEU. Alphaliner said the revision of the FE4 loop was expected to be part of a wider reshuffle of the current five Asia-North Europe and three Asia-Mediterranean loops operated by the THE Alliance. The three carrier alliances are expected to announce their 2020 network revisions in the coming weeks. Alphaliner said a draft schedule of the revised FE4 service shows that the rotation would be 12 weeks with Asia coverage extended to Qingdao and Busan, and European calls including the Spanish hub of Algeciras in both Carriers previously paid nothing for their vessels to transit Mirs Bay, but now have to pay HK$34,968 (US$4,500) each time their ships call at YICT, according to the Marine Department's charging regime. That's more than three times the stan - dard pilot charges in Hong Kong of HK$10,688. "This is senseless and irresponsi- ble on the part of the respective Hong Kong and Shenzhen governments, that oceangoing vessels need to face such operational inefficiencies and cost burden, particularly when alternative solutions could have been pursued in the past two-and-a-half years," Giannetta said. Ships calling at YICT, which is controlled by Hutchison Ports, have no alternative but to transit Mirs Bay in Hong Kong waters to reach the terminal, which mainly handles trans-Pacific services. Outsized impact A YICT spokeswoman attributed the question of compulsory pilotage to Hong Kong's Marine Department and the shipping lines. She declined to comment on the potential negative impact of the move. As for why Mirs Bay was pilot-free until this year, one Hong Kong-based master mariner said relatively few oceangoing vessels use Mirs Bay compared with more congested and narrower areas of Hong Kong waters. These include areas around the Kwai Chung container terminals and approaches to the western Shenzhen terminals. But carriers invariably call at the Hong Kong terminals or YICT first before calling at the other facility. YICT and the Shekou and Chiwan terminals in the west comprise the major terminals making up Shenzhen port, handled 13.2 million TEU last year, about half of the 25.7 million TEU handled by Shenzhen as a whole. "If costs at Shenzhen become too expensive, say, because of the new double-pilotage requirement, carriers will skip Yantian altogether," Giannetta said. "If or once that hap - pens, ships are not going to go to Hong Kong instead. Hong Kong is not a 'must-call' port. Carriers will just skip both ports. So, by discouraging business to Yantian, the Hong Kong government is also discouraging busi- ness to Hong Kong." directions, enabling HMM to also load Asia-Med cargo on the loop. HMM's new alliance partners are eagerly awaiting the carrier's arrival, with Bronson Hsieh, chairman of Yang Ming Marine Transport, telling The Journal of Commerce late last year it would be a "good marriage." Following the announcement, Hapag-Lloyd CEO Rolf Habben Jansen and ONE CEO Jeremy Nixon, said HMM's mega-ships would allow for expanded service offerings, wider Double jeopardy Carriers say pilot fee hike at China's YICT could hurt Hong Kong volume By Keith Wallis Since Jan 1., ships calling at YICT must pay HK$34,968 ($4,500) for pilotage through Mirs Bay. HMM's mega-ships will add capacity to an already heavily supplied Asia-Europe market.

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