CMA CGM Group expected to restart bookings from Asia to North Europe on December 28

Marseille, France (PortSEurope) December 23, 2020 - French shipping CMA CGM Group is expected to restart bookings for cargo from Asian ports to Northern Europe on December 28, after suspending it at the start of the month due to containers shortage and heavily increased demand. CMA CGM, the fourth largest shipping group in the world, was forced to stop accepting cargo bookings on one of the world’s major trade lines during the peak season demand due to severe shortage of empty containers in Asian ports that has been building since September. Container availability in Asia, measured by the Container xChange’s Container Availability Index (CAX) dropped 37%, or to almost half the level compared to the same time in 2019. According to shipping sources, empty containers in Europe spend on average 23 days in ports. Other major carriers continue to accept bookings, but have increased their FAK (freight all kinds) rates. Attempting to tackle the issue, last week CMA CGM announced that it is reinforcing its presence through improved port coverage and vessel deployment on its EPIC (Europe Pakistan India Consortium), EPIC2, MEDEX (Middle East Gulf & Indian Subcontinent Services) and MEGEM (Middle East Gulf East Mediterranean) services, allowing for increased connectivity to the global CMA CGM solutions. These improvements will be implemented from January 2021 and will offer enhanced transit times to customers and increased capacity between Asia and Europe to meet the high demand for cargo and shipping services after the contraction caused by the COVID-19 pandemic in the first half of 2020. CMA CGM boosted capacity assigned to lines between Asia and Europe by 6% for Q4, 2020 compared to the same period in 2019. It will make further additions in the first quarter of 2021, when capacity will be 10% higher than in the current quarter. The increase in capacity will be provided by a new class of 23,000 TEU LNG-powered vessels assigned to Asia-Europe trade, three of which are already in service. CMA CGM will use two more loaders operating on these routes and will provide departures from China to France and from China to the Netherlands before the end of December. CMA CGM is also implementing measures to speed up the return of empty containers to Asia and cut their delays at the ports it serves in Asia and Europe. Since the summer of 2020, CMA CGM has increased the size of its container fleet by 8.7% and rerouted services to clear the build-up of empty containers. EPIC services will offer the fastest connections from the Middle East and the Indian subcontinent to Northern Europe. Transshipment opportunities will deliver increased coverage to and from Red Sea, East Africa, South America, West Africa, U.S. East Coast, U.S. Gulf, Canada, Scandinavia, Poland, Baltic states, Russia. CMA CGM will operate five vessels on the EPIC North Europe service, thus having the operational lead on this historical trade of the CMA CGM Group. MEDEX and MEGEM services will include a Westbound call in Tripoli, Lebanon (becoming more important after the devastating explosion in Beirut, Lebanon’s main port on August 4). As a new hub within the country, this will allow clients to connect with the Black Sea, the East Mediterranean and North Africa trades. EPIC service rotation: Southampton, Bremerhaven, Rotterdam, Antwerp, Le Havre, Algeciras, Jeddah, Jebel Ali, Abu Dhabi, Port Qasim, Nhava Sheva, Mundra, Jeddah, Tangier. Weekly service with 8 vessels (CMA CGM will operate 5 vessels). Nhava Sheva to Rotterdam voyage duration 20 days. Rotterdam to Jebel Ali voyage duration 23 days. Full voyage duration 56 days. Launch in Jebel Ali on January 13, 2021 EPIC 2 service rotation: Rotterdam, Hamburg, London, Antwerp, Tangier, Jeddah, Jebel Ali, Karachi, Nhava Sheva, Hazira, Mundra, Jeddah, Tangier. Weekly service with 8 vessels. Nhava Sheva to London 28 days. Hamburg to Mundra 31 days. Full voyage duration 56 days. Launch in January 2021 MEDEX service rotation: Tripoli, Piraeus, Malta, Genoa, Valencia, Barcelona, Fos, Genoa, Malta, Damietta, Aqaba, Jeddah, Hamad, Jebel Ali, Karachi, Nhava Sheva, Mundra, Jeddah. Weekly service with 8 vessels (CMA CGM will operate 3 vessels). Mundra to Valencia 20 days. Damietta to Karachi 17 days. Full voyage duration 56 days. Launch in January 2021 MEGEM service rotation: Port Said, Tripoli, Mersin, Piraeus, Izmit, Istanbul, Aliaga, Iskenderun, Damietta, Jeddah, Jebel Ali, Hamad, Dammam, Jubail, Jebel Ali, Jeddah. Weekly service with 7 vessels (CMA CGM will operate 2 vessels). Istanbul to Hamad 19 days. Damietta to Jebel Ali 9 days. Full voyage duration 49 days. Launch in Jebel Ali on January 9, 2021 The old names abbreviated to make the new CMA CGM were Compagnie Maritime d'Affrètement - Compagnie Générale Maritime (or Maritime Freighting Company - General Maritime Company) Reuters, the global news and information provider, published in early December an analysis of the global shipping containers shortage damaging China manufacturers’ ability to fulfil increased orders. This is a brief summary of the graphics’ illustrated story: – Exports from China surged 21% in November from a year ago – China is exporting three containers for every one imported recently – Roughly 60% of global goods move by container, and according to United Nations, there are 180 million containers worldwide – Average container turnaround times have ballooned to 100 days from 60 days previously because of COVID-19-related handling capacity cuts in Europe and the United States – The grounding of much of the global international passenger air fleet – which often also carries cargo – has also boosted demand for maritime freight – The cost of chartering a 40-foot container from China to the U.S. East Coast scaled a record $4,928 this week, up 85% since June 1. Rates to Europe have jumped 142% over the same period, and by 103% to the Mediterranean via the Suez Canal – The rates for some shorter-haul – and lower-margin – routes have increased even more. The Ningbo Containerised Freight Index from China to Singapore/Malaysia soared nearly 300% between early October and early December as a bidding war for shipping space broke out among Southeast Asian exporters – Monthly container production output in China – which accounts for 96% of global production – hit a five-year high of 300,000 units in September – Some private Chinese firms have been stockpiling containers which are made available to the highest bidder – Industry observers expect the container tightness to persist until coronavirus vaccines are rolled out widely and more global travel resumes Copyright (C) PortSEurope. All Rights Reserved. 2020

CMA CGM Group expected to restart bookings from Asia to North Europe on December 28

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CMA CGM Group expected to restart bookings from Asia to North Europe on December 28

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Our Expert Analysis

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