Maersk’s new ocean service cuts Bangladesh- China shipping time, freight costs

Danish shipping and logistics giant AP Moller-Maersk, widely known as Maersk, has introduced a new ocean shipping service between China and Bangladesh, which reduces transit time by about three days and thus slightly lowers freight costs.

The new service, named SH3, was launched on 7 July, according to a press release issued by Maersk Monday (15 July). 

The SH3 rotation begins at Shanghai Port in China, making stops at Xiamen, Kaohsiung, Nansha, and Tanjung Pelepas before arriving in Chattogram, Bangladesh. On the return journey to Shanghai Port, SH3 will call Tanjung Palapas, where long-haul routes to Europe are connected.

According to Maersk Line, currently, three vessels arrive at Chattogram port from China under three services — SH1, SH2 and IA7 — in a week, taking 15 days for the voyage. 

However, with the new service SH3, another vessel will reach Chattogram in 12 days from Shanghai, saving three days. As a result, freight charges will be slightly reduced.

MCC YANGON, the first container ship operating under SH3, began its journey from Shanghai Port on 7 July and is expected to arrive at Chattogram Port on 18 July.

The new service is launched as Maersk and Bangladesh's RMG industry stakeholders respond to increasing trade demands, particularly in retail, by enhancing capacity in the ocean network connecting the two countries.

Maersk said the introduction of the SH3 service will complement the existing SH1, SH2 and IA7 services between China and Bangladesh. Adjustments have been made to SH1 and SH2 to optimise the offering further. 

The combination of these services expands coverage in China, providing multiple options for loading cargo throughout the week from Shanghai, Nansha, and Ningbo and more direct shipping choices to Bangladesh. 

The varied options in transit time and frequency for customers will allow them to have not only additional capacity but also flexibility and efficiency in their supply chains, reads the press release.

Under the SH3 service, one vessel will arrive at Chattogram port every week, resulting in four vessels arriving per month. In total, 16 vessels will arrive from China per month across all services.

Nikhil D'Lima, head of Maersk in Bangladesh, said, "The demand for textiles and garments from Bangladesh in the Western markets is constantly growing. Our customers have been demanding more capacity for raw materials coming into Bangladesh and readymade garments getting exported."

"The redesigned network allows textile manufacturers in Bangladesh to gain flexibility and speed for imports of raw material as well as exports of finished goods, supporting Bangladesh's fast-developing RMG industry," Nikhil added.

RMG industry welcomes the new service

Garment owners said that China is the main source of the country's imported products, including industrial raw materials, raw materials for the ready-made garment industry, and electronic products. Bangladesh imports the most from China, accounting for one-fourth of its total import expenditure.

On the other hand, Bangladesh's main exports to China include woven garments, knitwear, home textiles, leather and leather products, footwear, jute and jute products, and plastic products.

Rakibul Alam Chowdhury, vice president of BGMEA, told TBS, "About 70% of the raw materials for the garment industry are imported from China. These products arrive at Chattogram Port via various transhipment ports, including Tanjung Pelepas, Singapore, and Colombo, which increases transit time. The new shipping service will enable faster transportation of goods."