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Viewing cable 08RABAT671, CMA-CGM PLANS DIRECT TANGER MED-NEW YORK SHIPPING

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Reference ID Created Released Classification Origin
08RABAT671 2008-07-18 15:28 2011-08-24 16:30 UNCLASSIFIED//FOR OFFICIAL USE ONLY Embassy Rabat
VZCZCXYZ0000
RR RUEHWEB

DE RUEHRB #0671/01 2001528
ZNR UUUUU ZZH
R 181528Z JUL 08
FM AMEMBASSY RABAT
TO RUEHC/SECSTATE WASHDC 8864
INFO RUCNMGH/MAGHREB COLLECTIVE
RUCPDOC/USDOC WASHDC
RHMFIUU/DEPT OF HOMELAND SECURITY WASHINGTON DC
UNCLAS RABAT 000671 
 
SENSITIVE 
SIPDIS 
 
USDOC FOR HQ/USFCS/USDOC/CS DG ISRAEL HERNANDEZ, USDOC FOR 
3131/USFCS/OIO/RD/ANESA/CREED/GLITMAN/STAUHID I, USDOC FOR 
ITA/USDOC/MAC/DAS HOLLY VINEYARD 
 
E.O. 12958: N/A 
TAGS: ECON ETRD EWWT MO
SUBJECT: CMA-CGM PLANS DIRECT TANGER MED-NEW YORK SHIPPING 
LINE FROM OCTOBER 
 
Sensitive but Unclassified - not for internet distribution. 
 
1. (SBU) Summary: Officials at CMA-CGM Shipping lines confirm 
that they will launch the first regularly scheduled service 
between the United States and Morocco at the end of October. 
The company will drop Lisbon from its weekly "Amerigo" 
service and will instead stop in Tanger Med both on its east 
and westbound sailings.  The line will enable Moroccan 
exports to arrive in the U.S. in eight and a half days, as 
opposed to the nearly 45 days they can currently spend in 
transit while being transhipped through European ports. 
CMA-CGM officials note, however, that the vast bulk of cargo 
they will carry will be transhipped from other ports: both 
they and their competitors at Maersk lines agree that 
Moroccan cargo is currently insufficient to support a 
service, as aside from seasonal reefer cargoes of fresh 
fruits and other agricultural products, significant volumes 
are not there.  End Summary. 
 
2. (SBU) CMA-CGM Director General Frank Torfs and Sales 
Manager Mohamed El Assad confirmed to Econ Counselor on July 
17 that the company had made a decision earlier this week to 
initiate a weekly service to the United States from the new 
container port at Tanger Med.  The service will begin at the 
end of October in order to coincide with the start of 
Morocco's fruit export season.  The service, the CMA 
officials said, will call at Tanger Med instead of Lisbon on 
both its east and westbound sailings.  Starting in Malta, the 
line will call in Italy, France and Spain, before stopping in 
Tanger Med on day nine.  It will then sail directly for New 
York, arriving on day 17, and then continue on to Norfolk, 
Savannah and Miami, before returning to Tanger Med and Malta. 
 Torfs noted that the company will actually begin operations 
in Tanger Med at the end of August, but will start with a 
feeder service that will take cargo to Malta to join the line 
there. 
 
3. (SBU) Torfs noted that the service will have a capacity of 
850 forty foot containers per week.  Moroccan origin products 
will likely be principally agricultural, he speculated, as 
there is great interest from Agadir growers.  He thus 
anticipates that during the season that the service may carry 
50-60 40 foot reefers of citrus products.  Growers would load 
in Agadir in late afternoon, he said, and then ship their 
cargo by road overnight to Tanger Med to meet the ship. 
(Note: the actual time benefit to exporters will be less than 
the headline nine day transit: such products require 16 days 
uninterrupted cold storage to meet U.S. requirements, and so 
will be warehoused on arrival until that threshold is 
reached.  End Note.)  Torfs judged that there is little other 
potential volume from Moroccan exports, as "textile is not in 
quantity" nor are other products.  He stressed, however, that 
"we can't just rely on historical figures," as the service 
will so dramatically cut transit times (from 45 to 8.5 days). 
 "We have underestimated the impact of Tanger Med," he added, 
and he sees even more potential on the return leg, as 
evidenced by the increasing number of reefer cargoes coming 
eastbound from North America. 
 
4. (SBU) Torfs also predicted that much cargo for Rabat and 
points north that currently transits through Casablanca will 
be redirected to Tanger Med.  Congestion at the Casablanca 
Port has improved over the "catastropic" situation that 
characterized last year, but it remains difficult, and 
companies may be willing to pay the added cost to use the 
more modern Tanger facility. 
 
5. (SBU) For their part, CMA-CGM's competitors at Maersk 
lines indicate that they have no plans to open a direct line 
to North America from Tanger Med, though they stress that 
shipping plans are continually reevaluated and could change 
on short notice.  While the company operates lines to Tanger 
Med from virtually every other continent, including South 
America, its North American lines will remain based at the 
Spanish port of Algeciras, 14 miles from Tanger Med.  Feeder 
lines ferry cargo between the two ports.  Maersk Director 
General Denedis Franck noted that while there has been 
political pressure  for a U.S. line to support the free trade 
agreement, "from a business point of view it is not doable." 
The market, he added, "is far from being close to affording a 
line, as the required volumes simply aren't there." 
 
6. (SBU) Comment: Shipping industry comments about the 
weakness in Morocco's export volumes are borne out by the 
continued degradation in Morocco's trade balance, with 
 
exports covering a diminishing share of the country's 
burgeoning imports.  New business may nonetheless emerge with 
the faster turnaround offered by the planned New York 
service, though Torfs is likely right that more will emerge 
initially on the eastbound leg.  Torfs asked Embassy 
assistance in ensuring that the company meets U.S. security 
and other requirements and we will work with DHS and other 
appropriate agencies to ensure that necessary arrangements 
are in place to assure a smooth launch to the service in 
October.  End Comment. 
 
 
***************************************** 
Visit Embassy Rabat's Classified Website; 
http://www.state.sgov.gov/p/nea/rabat 
***************************************** 
 
Riley