Maersk service to southern India is a success, but the market rates are still going up

Maersk service to southern India is a success, but the market rates are still going up

Maersk service to southern India is a success, but the market rates are still going up.

Last year in August, Maersk launched a weekly eight-vessel string named ME7. This was launched from the Ennore port near Chennai. 

Each ship carries a capacity of 6500 TEU on a rotation of Ennore, Colombo, Salalah, Algeciras, Felixstowe, Rotterdam, Bremerhaven, Jeddah, Salalah, Colombo, and back to Ennore. Maersk line is somewhat hopeful after building a stable direct connection to the Southern India market.

“Our ME7 direct service has been very well received by our customers, especially in the lifestyle and retail segment,” Maersk (India) told The Loadstar.

Maersk calls ME7 an “antidote” to the ever-existing shipping related problems in India’s east coast. They had suffered from the shortage of direct shipping connections, which forced cargo owners to depend on other trans-shipment options such as Colombo, Singapore and Port Klang.

ME7 provides a direct source of volumes for Adani Ennore Container Terminal (AEDC), which had struggled before to attract long-haul liner customers due to tax-related issues. It served as an alternative for congested Chennai Terminals and handled the vehicle export movements.

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“We are constantly monitoring developments in global supply chains and are in touch with our customers to better understand their requirements,” said Maersk, “and are prepared to adjust services depending on what customers demand and what the overall logistics ecosystem can offer.”

However, the freight rate levels have been witnessing a continuous upsurge, and it would even grow as a more significant concern due to the more surcharges in the future.

In fact, on the 15th of February, CMA CGM will begin to charge an overweight surcharge (OWS) on cargo booked from North Europe, the Mediterranean, Black Sea and Adriatic for north/west India on its premium EPIC1 & EPIC2 services. The new cost will be $200 per dry container, weighing over 15 tons, including tare. 

The French Liner states that this surcharge is necessary to maintain reliable and efficient services to the customers. But this upsurge in the rate levels has resulted in the backing off of many Indian exporters.

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