Clarksons: Era of Major Consolidation to Take a Breather?

Following a wave of major consolidation in the container shipping industry, the trend could diminish following the mergerof OOCL and China COSCO Shipping, according to Clarksons Research.

The start of joint operations as of April 2018 between major Japanese containership operators NYK, MOL and K-Line, as the Ocean Network Express was another milestone in the ongoing consolidation of the sector.

When looking at the past 20 years, Clarksons said that there was an acceleration of this trend, with significant merger and acquisition activity.

In 1998, the top 20 carriers accounted for 73% of deployed capacity globally, with the largest (Maersk) with a 7.2% share and the carrier ranked 20th (CSAV) with 1.3%. The top 20 included some famous old names, and was essentially made up of the global carriers of the day. The list of carriers ranked 21-30 also contained some carriers still well-known today: Wan Hai, Crowley, Matson and PIL (ranked 30th) as well as carriers since notably merged with others such as Safmarine, UASC, Hamburg-Sud, Delmas and MISC.

However, consolidation has greatly changed the situation and the top 20 now account for 90% of all capacity, while the top 10 account for a mighty 83%. The largest carrier (still Maersk) now accounts for 19.4%, but the carrier ranked 10th (Zim) for 1.8% and the 20th (Quanzhou Ansheng) just 0.3%.

“This profile is the result of an era of major consolidation, which looks like it might take a breather as and when the merger of OOCL with China COSCO Shipping is completed,” Clarksons said.

“The scope of the liner companies’ cost base and the perceived benefits from economies of scale have led to a slimming of the number of major operators long considered inevitable by many.”

A heavyweight top 10 carriers operates 10.4 times the capacity of the carriers ranked 11-20, compared to 2.4 times 20 years ago.

Farsana

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