One of the world's largest steamship lines, China Ocean Shipping Co., will begin service from Baltimore this winter, providing a crucial shipping link between the port of Baltimore and the rapidly growing Far East market.
Under an agreement announced in Baltimore yesterday, the China Ocean Shipping Co. (Cosco) will call at the port's Seagirt Marine Terminal three times a month, with container service between the U.S. East Coast and the Far East by way of the Suez Canal.
The new service is a major victory for Baltimore, which has been struggling to rebuild its port operations after a substantial loss of cargo to the port of Norfolk, Va., during the 1980s and early 1990s.
In choosing a mid-Atlantic port, the Chinese shipping company apparently selected Baltimore over Norfolk. A spokesman at Cosco's U.S. headquarters in Secaucus, N.J., declined to comment.
The 36 Cosco vessels each year will mean increased cargo -- though port officials provided no estimate of how much -- and will increase work for dockworkers who unload the ships, bay pilots who guide the huge vessels to the terminals, and other businesses such as freight forwarders.
The first Cosco ship is expected to arrive Feb. 4, according to the Maryland Port Administration, which operates the state's public terminals.
While several shipping lines offer direct service from the Far East to Baltimore, none provides shipping service from Baltimore to the Far East. This has been seen as a crucial missing piece in the port of Baltimore's operation, hampering export business here.
"While we were able to bring in cargo, we were not able to export," Adrian G. Teel, executive director of the port agency, said yesterday. "It was the one hole we had in terms of service that we needed to fill."
"The Far East and Southeast Asia are the fastest-growing areas in the world and are just starting to bloom," he said. Last year, Mr. Teel noted, the growth in China's gross national product was 13 percent, compared with less than 3 percent in the United States, while Southeast Asia's was 7 percent.
As a result, China has been stepping up its exports substantially to the United States and has been importing far more U.S.-made products, such as electronics and building materials.
Baltimore port officials said they hope to attract exporters to the Far East who have avoided Baltimore altogether. And, they said, Cosco could produce a ripple effect.
"If Cosco does well here, other lines that ship to the Far East will have to look at using Baltimore," Mr. Teel said.
Currently, cargo from Baltimore to the Far East must be loaded onto barges and transported to either the port of New York or to Norfolk, where the goods are transferred to ships. Because this procedure is more costly, most shippers have used other ports.
"This will induce us to ship more from the port of Baltimore," said Jeff Stanes, traffic manager for Baillie Lumber Co., a Hamburg, N.Y.-based lumber company. Mr. Stanes said the company moves about 40 percent of its lumber destined for the Far East through Baltimore. The remainder is shipped through Norfolk and Charleston, S.C.
Cosco, owned by the Chinese government, is based in Beijing and has a fleet of more than 50 vessels. Cosco eliminated its service from the Far East to the U.S. East Coast via the Panama Canal and replaced it with direct service to the East Coast via the Suez Canal.
As a result, the company dropped its service to the port of Houston and picked up Baltimore as a third East Coast port. It already serves New York and Charleston.
The service will connect Baltimore with the ports of Xingang and Dalian, China, as well as Hong Kong and Singapore.