Logistics Management - October 2011

Special Report: Top 30 Ocean CarriersA special supplement to logistics managementProminent members of TheShipper Council agree, saying thatthey share in a mission to work collectivelytowards leveraging technologyto improve business processesand relationships with commonindustry partners. “The ShipperCouncil has been advocating changefor the past two years,” says MikeMurphy, associate director of logisticsprocurement at Kraft Foods Global,Inc. “When we saw Mr. Kolding’sannouncement, we immediately sawan opportunity to take action.”Dennis Melgert, strategic sourcingmanager of logistics at chemicalproducts producer Celanese Corp.,shares Murphy’s vision: “We believethat there is an opportunity to engagethe liner industry as a group andmake broad substantial change thatbenefits everyone. We were thrilled tosee Maersk Line take the lead.”The Shipper Council has alreadyestablished a dialogue with Maerskand executives from several otherleading carriers. The group saysthat it’s committed to comingup with specific ideas that can beimplemented quickly to the benefitof both shippers and carriers. Ideason the table include:• managing allocations andimproving forecasting on a secureneutral platform;• streamlining documentationand substituting electronic bills oflading for paper to act as “one versionof the truth;”• using technology to improvebusiness-to-business processes betweenshipper and carrier; and• collaborating “in the cloud” byusing our virtual community to its fullpotential.“Reliability, predictability, and simplicitycreates value,” says Siva Narayanan,head of maritime and warehousing atRhodia Inc., a specialty chemicals company.“We believe that collaboration fusedwith neutral, industry-wide technologyAlphaliner Top 30(Operating fleets as of September 2011)Rank Operator TEU Share1 APM-Maersk 2,455,014 15.7%2 Mediterranean Shg Co 2,029,482 13.0%3 CMA CGM Group 1,324,174 8.5%4 COSCO Container L. 650,840 4.2%5 Hapag-Lloyd 627,725 4.0%6 Evergreen Line 611,678 3.9%7 APL 586,364 3.7%8 CSCL 505,913 3.2%9 Hanjin Shipping 494,654 3.2%10 CSAV Group 468,562 3.0%11 MOL 421,303 2.7%12 OOCL 412,182 2.6%13 Hamburg Süd Group 405,897 2.6%14 NYK Line 397,473 2.5%15 K Line 342,763 2.2%16Yang Ming MarineTransport Corp.336,328 2.1%17 Zim 332,845 2.1%18 Hyundai M.M. 306,443 2.0%19 PIL (Pacific Int. Line) 266,042 1.7%20 UASC 234,815 1.5%21 Wan Hai Lines 170,510 1.1%22 HDS Lines 88,744 0.6%23 TS Lines 77,500 0.5%24 X-Press Feeders Group 62,477 0.4%25 CCNI 60,293 0.4%26 MISC Berhad 55,192 0.4%27 Matson 49,530 0.3%28RCL (RegionalContainer L.)49,339 0.3%29 KMTC 48,404 0.3%30 Grand China Logistics 47,576 0.3%Source: Alphalineradoption will help achieve the vision thatMaersk put forward.”Patrick Halloran, director of global tradeand logistics at Cardinal Health, is also onthe same page with his fellow council members,noting that the key now is to movepast dialogue and into action. Accordingto Halloran, The Shipper Council iscommitted to making this happen. “Membersare contacting carrier executives andhosting meetings to develop specific plans,”he says. “The group will then determinewhat it can do to collectively address someof finer details in the relationship.”Better late than neverThis development is coming just intime, say analysts, who note that carrierswere beginning to go too far in their zealto recapture rates this year. The EuropeanCommission’s investigation of “pricefixing”has vessel operators scurryingfor cover, but regulators in the U.S. aredoing their part to keep the game boardfree from collusion.The European Commission’s investigationof ocean carrier antitrust rulesramped up to a new level last spring asAsian companies were also brought intoview. Meanwhile, the Federal MaritimeCommission is listening to U.S. shippercomplaints that Transpacific “talkingagreements” represent an added monopolisticthreat.“In the old days of conference pricing,this kind of behavior was called‘independent action,’” says Dirk Visser,managing director of the Dutch consultancyDynamar. “But the governmentis now becoming much more vigilantwhere this is concerned.”Indeed, the Commission reports thatwhen antitrust officials raided Europeanheadquarters, Asian carriers were amongthe others targeted for investigation.Neptune Orient Lines, OOCL, EvergreenMarine, and Hanjin Shipping—all leading operators in the transpacifictrade—are said to be complying withthe price-fixing probe.Just last May, EU regulators begansearching through the files kept byMaersk, CMA-CGM, and Hapag-Lloyd. The unannounced visit was madeto enforce the abolished exemptionfrom antitrust activity the Commissionenacted three years ago. Spokesmen forOOCL confirmed that the Commission’sraid was not “carrier specific,” and54S October 2011 • Logistics Management