Through Suez or not?

MARKETPLACE confusion has arisen over whether the MSC/CMA CGM joint ‘direct’ service between Europe and Australia is reverting to Suez Canal/Red Sea transits or not.

The weekly service, known as Australia Express (AES) by MSC and New NEMO (abbreviated to NEWMO) by CMA CGM, has routed via the Cape of Good Hope since December 2023 following the impact of Middle East hostilities on the Red Sea passage. This diversion extended transit times and required additional ships to maintain weekly frequency.

Late last week MSC was said to be considering the return on a ship-by-ship basis, with schedules indicating a possible immediate southbound change but showing no alteration to transits, i.e. arrival times in Australian ports.

However, CMA CGM yesterday posited a full-blooded return to Suez, issuing a new NEWMO service profile naming the revised port rotation, 16 ships (down from the current 18) and transit times. Notably there are no Middle Eastern nor eastern Mediterranean port calls as were included in the previous via-Suez iteration.

At time of writing nothing definitive was available from MSC which, as the major service partner, supplies all but six of the combined fleet of 8,400-9,400 TEU vessels.

Shippers and forwarders contacting DCN seeking clarification of the situation expressed doubts the majority of customers are ready to accept the additional risks for their cargoes, especially given the renewed and increasing attacks on shipping and the ongoing uncertainties in the area.

While one told DCN a client was pushing hard for the resumption given the improved transit times for Australian exporters it was unclear what insurance cover was available and at what price. There was also concern expressed for the potentially imperilled seafarers.

Another noted that direct service rates have fallen notably in each direction in recent weeks, obliging the carriers to cut operational costs and/or see more business lost to transhipment over Asian hubs. There was even a suggestion the Suez return may be a market bluff: “You want us to continue sailing the safer long-way-round, you pay more for the privilege”.