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SM Line - its first months of operation in the container shipping industry

Founded last December and active in the container shipping industry since last March, SM Line Corporation (SM Line) is a South Korean company that has built its fleet by purchasing former Hanjin Shipping container vessels (listed in table 1). Measured by fleet capacity SM is now on course to become one of the top 20 shipping lines.

Table 1 - Former Hanjin Shipping container vessels acquired by SM Line

New name

Former name

Vessel capacity (TEU)

SM SAVANNAH

HANJIN ROTTERDAM

8,586

SM NEW YORK

HANJIN LONG BEACH

8,586

SM BUSAN

HANJIN TIANJIN

6,650

SM LONG BEACH

HANJIN XIAMEN

6,650

SM NINGBO

HANJIN BUDAPEST

6,650

SM SHANGHAI

HANJIN BREMERHAVEN

6,650

SM YANTIAN

HANJIN PORT KELANG

6,650

MSC KWANGYANG

SM KWANGYANG

6,650

MSC SAVANNAH

SM NORFOLK

8,586

MSC SPAIN

SM HONG KONG

6,650

MSC PORTUGAL

SM SEATTLE

6,650

Source: MDS Transmodal, Containership Databank, October 2017

Since SM Line first started operating in the container shipping industry last March, it has grown rapidly. Based on our Containership Databank, we estimate that the line offers a total capacity of approximately 0.7m TEU with its services mainly concentrated in the intra-Far East region with one on the transpacific trade lane as shown in the following table.

Table 2 - SM Line services

Service

Number of vessels

Annual frequency

Regions served

 Deployed capacity (TEU)

SM LINE - CPX

5

52

Far East - North America

             345,800

SM LINE - KCX

1

52

Far East

               85,540

SM LINE - KHX

2

52

Far East

               58,188

SM LINE - KJX

1

52

Far East

               36,608

SM LINE - VIX

4

52

Far East

               82,186

SM LINE – VTX

3

52

Far East

               79,005

*GSL/KMTC/RCL/SM LINE/TSL - RPM

6

52

Far East – Gulf & ISC

299,000

Total

 

 

 

             986,327

Source: MDS Transmodal, Containership Databank, October 2017

*Service starting in Nov 2017

For the near future, SM Line plans to begin operating to the Transpacific (ECNA) and to start a new Transpacific (North America WC) service by April 2018. New services will also include Australia, South America WC and the Middle East trades as shown in the following map.

Map 1 - SM Line, existing and future services

Source: https://smlines.com/en/serviceplan.php

Measured by fleet capacity, we estimate that SM Line is now one of the top 30 biggest players in the industry (see table 3) and, although it cannot realistically represent a threat for the biggest names, it shows an alternative circumstance in an era characterised by M&As and consolidations. However, how long the company will operate on its own remains to be seen.

Table 3 - Top 30 shipping lines*

Rank

Shipping line

 Fleet capacity (TEU)

1

Maersk

                 3,379,640

2

MSC

                 3,070,697

3

CMA-CGM

                 2,423,381

4

COSCO

                 1,748,339

5

Hapag-Lloyd

                 1,465,766

6

Evergreen

                 1,059,461

7

OOCL

                    670,916

8

Yang Ming

                    581,191

9

Hamburg-Sud

                    550,022

10

MOL

                    549,145

11

NYK

                    545,809

12

PIL

                    375,075

13

ZIM

                    362,719

14

K-Line

                    349,062

15

Hyundai

                    339,178

16

Wan Hai

                    233,763

17

X-Press Feeders

                    142,402

18

KMTC

                    122,480

19

SITC

                      98,494

20

IRISL

                      92,876

21

Arkas Line

                      74,940

22

TS Lines

                      68,767

23

Simatech

                      67,394

24

Quanzhou An Sheng Shipping

                      53,220

25

Transworld

                      51,367

26

SM Line

                      48,717

27

Sinokor

                      47,458

28

Unifeeder

                      47,223

29

CNCO

                      46,951

30

RCL

                      44,668

All others

 

                 2,891,694

Total

 

              21,602,815

*Based on all full-cellular and semi-cellular ships
Source: MDS Transmodal, Containership Databank, October 2017