Date
24 March 2017
Maersk Line has been hit by historically low freight rates in the first half of this year. Photo: Bloomberg
Maersk Line has been hit by historically low freight rates in the first half of this year. Photo: Bloomberg

Maersk Line quits 10 China ports in bid to cut costs

Maersk Line, the world’s biggest container shipper, has decided to stop services to and from 10 ports in China as part of a drive to reduce costs.

Like other container shipping companies, Maersk Line has been hit by historically low freight rates in the first half of this year due to a slowdown in global growth and many new, larger vessels being added to the market.

Maersk Line, a unit of Danish conglomerate AP Moller-Maersk, said it would stop serving ports in Chizhou, Luzhou, Yingkou, Jinzhou, Rizhao, Yueyang, Lijiao, Taiping, Jiaoxin and Nansha old port, Reuters reports.

The ports are currently served by feeder vessels that move goods to larger ports where mega-vessels with capacity of up to 20,000 20-foot containers take over and transport the goods to ports mostly in Europe and the United States.

Maersk Line said in a statement it would focus on ports that offered the best growth prospects and opportunities for its customers.

“The closure of service in these Chinese ports should not be interpreted as a change of strategy,” Maersk Line wrote in an email to Reuters, declining to give further comments.

The AP Moller-Maersk group will publish second-quarter results on Friday and Maersk Line is expected to post a loss of US$67 million, according to a Reuters poll.

Maersk Line is currently represented in 41 locations in China, which has been recognized as the world’s factory since the late 1970s. In recent years, Chinese growth has slowed.

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CG

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