COSCO Shipping Ports Ltd. and CMA CGM Terminals Holding signed a worldwide memorandum of understanding to seek cooperation at ports worldwide, with preference being given to ports called by the Ocean Alliance.
Two of the world’s largest container terminal operators, COSCO SHIPPING Ports and CMA Terminals Holding, said they have signed a memorandum of understanding (MOU), seeking cooperation at ports worldwide, with preference being given to ports called by the Ocean Alliance.
The Ocean Alliance, which is scheduled to commence operations in April, is a vessel sharing
agreement on major east-west trade routes between four of the largest container shipping companies: CMA CGM, the third largest in terms of capacity; COSCO Shipping, the fourth largest; Evergreen, the fifth largest; and OOCL, the ninth largest.
The terminal arms of CMA CGM and COSCO said they “have also agreed to provide support in terms of business and service to the ports that the other side has already invested.”
CMA CGM said, “Since the establishment of the Ocean Alliance, the cooperation between COSCO Shipping Ports and CMA Terminals Holding has become closer. Both sides wish to create more opportunities in global port investment and operation.”
Although the MOU was signed last week, discussion of cooperation began in early 2016, according to CMA CGM.
Neil Davidson, senior analyst-ports and terminals at London-based shipping research and consulting firm Drewry, referred to the MOU as “very interesting.” He said, “You can see that the two parties have said ‘we’re in the same liner alliance together so we might as well work together in terms of our terminal interests too.’ It’s more evidence of alliances on the terminals side of the business.”
He said that COSCO SHIPPING Ports, which was formed through the merger of the terminal businesses of COSCO and China Shipping, is the larger of the two businesses, but noted CMA CGM has a sizeable global network spread around the world.
Based on a combined equity throughput basis in 2015, when COSCO and China Shipping had still not merged, he said the companies would have been in fifth place in Drewry’s global/international terminal operators league table.
CMA CGM Terminals Holding’s rank is complex to calculate, encompassing two businesses, which include:
• CMA Terminals, which is fully owned by CMA CGM;
• And Terminal Link, a joint venture held by CMA CGM (51 percent) and China Merchants Holding International (49 percent).
Generally speaking, Davidson said relationships between terminal companies are becoming more spaghetti-like. For example, CMA CGM also has a joint venture with the Turkish company Yildirim Group in Marsaxlokk, Malta, and CMA CGM acquired terminals owned by Neptune Orient Lines when it acquired APL last year. Reports last fall said CMA CGM is looking to sell those terminals.
China Merchants Holding International owns other terminals of its own
and is involved in joint ventures with companies such as Modern
Terminals and Shanghai International Ports Group.
COSCO, CMA CGM terminal businesses to cooperate
