New boxship services to Latin America reflect a variety of approaches to a volatile market. Paul Richardson, AJOT’s UK-based containership service analyst, takes a look at today’s services and the potential impact of the completion of work on the Panama Canal. There can be little doubt that the biggest asset to the development of the Latin America container trades will be the completion of work on the Panama Canal lock system in 2014, and eventual ability of the canal to accommodate vessels up to 12,000 teu capacity. The work comprises the construction of two lock systems, one at the Atlantic end, and the other at the Pacific end of the canal, the excavation of new access channels to the new locks, the widening of the existing channels, and the deepening of channels in the approaches to Gatun Lake. With the present breadth restriction of the Gatun Lock system keeping vessel capacity to a maximum of some 5,000 teu, 2014 will be the start of a new era for shipping lines involved in the Latin America trades. But before the euphoria breaks forth, there are a number of aspects to be considered, none the least, whether the trades that would benefit from such a huge increase in capacity potential, are actually strong enough to accommodate it. WAN HAI CONFIDENT There are varying degrees of confidence coming out at the moment, with arguably Wan Hai Lines showing up as the strongest contender for the confidence title. Wan Hai launched a new Asia/West coast South America service from the beginning of July, using 1,500/1,600 teu vessels. The port coverage is Kaohsiung, Shekou, Hong Kong, Ningbo, Shanghai, Manzanillo (Mex), Lazaro Cardenas, Buenaventura, Guayaquil, Callao, Manzanillo (Mex), and Kaohsiung. Importantly, the inclusion of both Manzanillo (Mex) and Lazaro Cardenas add to the potential of the service, as they are both important transshipment hubs mainly catering for North/South volumes, which would include the US markets. Wan Hai’s move to launch its own service covering the Asia/WCSA trade followed the decision by the Taiwan line to leave a joint service previously operated between Wan Hai, Evergreen, COSCO and Pacific International Lines (PIL), so indeed it was a bold move. CMA-CGM GOES IT ALONE Continuing the bold approach recently, has been CMA-CGM, which has also opted to go it alone on the Latin America trade, this time on the Central America/Caribbean/East coast South America trade. Earlier this year, Maersk gave notice of intentions to leave the joint service operated with CMA-CGM, which the French line marketed as the Brazil Express or BRAZEX, and this was followed in July, by slot purchaser, Hapag-Lloyd’s decision to also leave. Thus, it came down to decision time for CMA-CGM and whether, or not to continue to operate the service alone. The answer was not long in coming - CMA-CGM would not only continue to operate the service, but also increase port coverage. There will be additional calls at Manaus and Salvador de Bahia, and instead of deploying 6 x 2,800 teu vessels split equally between Maersk and CMA-CGM, the latter will deploy eight of 1,700 teu. All this officially started on August 20th, and the BRAZEX now covers: Manzanillo (Pan), Kingston, Port of Spain, Manaus, Suape, Santos, Paranagua, Itajai, Santos, Rio de Janeiro, Salavador de Bahia, Cartagena, Manzanillo (Pan). Once again, the all important transshipment business potential kicks in with Manzanillo in Panama included this time. Still on the transshipment potential, the CKYH Alliance has not been long in recognizing the importance of this business in Latin America. CKYH Alliance line, Yangming has just added a new eastbound call at Manzanillo in Mexico to the Asia/USEC all water service known as the AWE3, from late July. The service, which is entirely tonnaged by Yangming, with COSCO, K Line and Hanjin having slots, is using the SSA Mexico Terminal (SSAM) in Manzanillo, and the obvious potential here are the ongoing connections with the west coast of South America. Under the new AWE3 rotation, p