CMA CGM introduces world’s biggest boxship


CMA CGM is expected to unveil solid third-quarter profits just days after taking delivery of the world’s largest containership.

The two events, while unconnected, represent a big morale boost for the Jacques Saadé-led line, which is frequently the focus of speculation over the state of its finances.

According to Lloyd’s Loading’s sister publication, Lloyd’s List, the third-quarter result is likely to represent a turnaround of nearly US$600 million from the $217 million net loss recorded in the July-September period of 2011.

The line returned to the black in the second quarter of 2012 and has made further progress since then, despite some softening of freight rates in the Asia-Europe trades.

However, prices recovered sharply on the route from Asia to northern Europe at the beginning of this month as general rate increases announced by major carriers held up well. Less successful were efforts to lift rates from Asia to the Mediterranean.

CMA CGM has pledged to take whatever action is required to protect improved Asia-North Europe rate levels by managing supply and withdrawing capacity if necessary.

The line has already blanked a couple of Asia-North Europe sailings and partner line Mediterranean Shipping Co has taken similar action, as have most other carriers in recent weeks.

For CMA CGM, which has four loops between Asia and northern Europe, one missed sailing accounts for a capacity cut of around 20% in any given week, depending on ship size.

Entry into service of the 16,000teu CMA CGM Marco Polo this week will not represent a big net increase in capacity, said Nicolas Sartini, Senior VP of the company’s Asia-Europe trades. The ship will replace an 11,000teu vessel that is being transferred to the Pacific trades.

The first voyage, which started in Ningbo on Wednesday, will be used partly to test the ship, the largest in service until Maersk’s 18,000teu Triple-E vessels start to be deployed next year.

The second sailing will be prior to Chinese new year when liftings are traditionally strong, Sartini said.

However, should conditions in the Asia-Europe trades worsen, CMA CGM has tools at its disposal to scale back capacity, Sartini said, including return sailings via the Cape of Good Hope if fuel prices justify the longer voyage.

CMA CGM will take delivery of two more 16,000teu ships next year. All three were originally specified at 13,300teu and then upgraded. Each is 396 metres in length with a 54 metre beam and a draft of 16 metres.

They are likely to operate at speeds of less than 20 knots on the headhaul leg, and more slowly on the return voyage.