The Chilean shipping company, Compania Sud Americana de Vapores (CSAV) has concluded several slot charter arrangements with Mediterranean Shipping Company (MSC) to replace recently withdrawn owned services – including SA. According to a press release from the line forwarded to FTW, they will come into force no later than the first week of August and remain valid for three years. One involves MSC’s weekly service between SA and the Middle East/India – calling at Durban, Jebel Ali, Karachi, Mundra, Nhava Sheva, Colombo and Durban. A second involves MSC’s weekly service between Asia and SA – calling at Fuzhou, Xiamen, Kaohsiung, Hong Kong, Chiwan, Singapore, Port Louis, Durban, Ngqura, Port Louis, Singapore and Fuzhou. This replaces the CSAV New Discovery service which it launched at the end of July last year. Negotiations regarding MSC’s weekly service between Asia and the East Coast of South America, which could involve transhipment in SA, are still taking place. These slot charter links between the two lines was confirmed to FTW by Glenn Delve, marketing director of MSC in Durban. The other agreements relate to the MSC services between northern Europe and central America/West Coast of South America, and between the East Coast of South America and the Middle East. Meanwhile, according to a report on CI-Online, the three year length of these slot charter arrangements implies a significant change in CSAV’s operations, which, up to now, have been more opportunistic. The root cause of the change is financial, with CSAV again returning into the red in the fourth quarter of 2010. Despite this, the report added, the company’s owners recently had no difficulty persuading shareholders to part with another US$430 million via a rights issue, a sum which is eventually expected to reach US$500 m. Unlike other top 20 ocean carriers, which charter around half of their vessel needs, nearly all of CSAV’s ships are chartered, putting it at the mercy of the rising charter market. CI-Online described this as “a lethal cocktail” when combined with plummeting freight rates in the main east-west trades.
