Cargo service quitting port next week

May 02, 2008|By Laura McCandlish | Laura McCandlish,SUN REPORTER

A cargo service that brought nearly 30,000 containers annually into Seagirt Marine Terminal is quitting the port of Baltimore after only two years.

French-owned CMA-CGM and China Shipping, two of the largest global shipping lines, will halt their joint weekly service from Europe to Baltimore on May 8, when it makes its final call here, according to CMA-CGM's North American headquarters in Norfolk.

It's the latest blow to the port administration's efforts to bolster container traffic in Baltimore, which for years has lost market share to East Coast ports that are closer to the ocean rather than up Chesapeake Bay. The port also lacks the ability to efficiently double-stack containers on trains, which is fast becoming the industry standard.

The departure leaves the port with three container carriers that connect Baltimore and Northern Europe: Mediterranean Shipping Co., Atlantic Container Line and Hapag-Lloyd Inc.

"Although we're sorry to see a carrier leave ... I don't think we're going to suffer in man-hours or volumes moving through the port," said Maryland Port Administration Director James J. White said. "It's one less choice that the importers and exporters have. They like as many carriers calling, so they can get the lowest freight rates."

Annual container traffic at Seagirt decreased in 2007 for the first time in at least five years, falling 2 percent to 479,123 TEUs, the equivalent of 20-foot containers. The port's overall container business grew less than 1 percent last year, to 495,909 TEUs, the MPA said.

But as the U.S. consumer economy slumped, nationwide container traffic across the country was down 7 to 9 percent last year, White said, so Baltimore fared better than some other ports.

The loss of the shipping service, however, could cut capacity at the port. With the weakened dollar creating a surging demand for exports, space on remaining trans-Atlantic freighters to Europe could become even tighter for U.S. customers.

Eastbound ships that once carried empty containers back to Europe are now laden with U.S. exports, which have become relatively cheaper there as the dollar has fallen against the euro and British pound.

"It's a daily struggle to find timely bookings," said Butch Connor, director of ocean operations for John S. Connor Inc., a global logistics company headquartered in Glen Burnie. "The exports could definitely be even higher than they are if there were more ships going out."

Most of the containers imported through the CMA-CGM/China Shipping route carried goods to be delivered within 100 miles of Baltimore, White said. That could prevent them from being redirected to other ports.

The three remaining trans-Atlantic carriers should pick that business up, said Mark Montgomery, vice president of East Coast operations for Ports America, which runs the Seagirt terminal.

"The cargo is originating here or coming here," Montgomery said. "The boxes will stay in Baltimore, but it's still sad to see the service leave."

CMA-CGM said it can no longer serve Baltimore because its new trans-Atlantic service will share vessels with Danish-giant A.P. Moller-Maersk. Maersk, which has just built a new $400 million container terminal near Norfolk, Va., has not called Baltimore in at least seven years, White said.

The new CMA-CGM/Maersk service will call the ports of Miami, Savannah, Charleston and New York. The old CMA-CGM/China Shipping route called Boston, New York, Norfolk and Baltimore.

laura.mccandlish@baltsun.com

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