China Shipping plans to sign a cooperation agreement with China Railway
China Shipping Container Lines plans to sign a cooperation agreement with China Railway Container Transport to transport container boxes by railway from ports in a bid to save transportation costs and take a step toward penetrating deeper inland through an integrated marine railway transport system.
"China Railway Container will be our strategic partner to develop marine- railway transport. The agreement will not involve capital investment," CSCL's board secretary Ye Yumang told The Standard Thursday.
CSCL, an offshoot of the mainland's second-largest shipping company, currently moves containers by rail from three ports in China, Shanghai, Lianyungang and Dalian.
The marine-railway transport model can be more economical and environmentally friendly than road transport.
Its advantages become obvious over long distances, according to an industry insider. One train is capable of carrying 100 20-foot equivalent units, or TEUs, or the combined capacity of 20 container trucks.
As at the end of 2006, CSCL had a fleet of 151 vessels with total operating capacity of 399,176 TEUs. The company aims to expand its fleet to 170 vessels with capacity of 524,000 TEUs by the end of 2009 to take advantage of growth expected in Chinese exports.
"It is positive to the company in the long term," said Credit Suisse analyst Karen Chan.
However, she expressed concerns that railway infrastructure is still underdeveloped in China.
The central government will spend 3.8 trillion yuan (HK$3.83 trillion) on transport infrastructure under its 11th Five-Year Plan, up 73 percent from 2.2 trillion in the previous plan.
Shares of CSCL resume trading today after being suspended Thursday.
The stock closed Wednesday at HK$2.93, down 1.35 percent.
Meanwhile, CSCL's sister company China Shipping Development (1138) is expected to announce a strategic contract to transport raw materials for coal producer Shenhua Group after signing earlier deals with petroleum company Sinopec (0386) and steel firms Shougang and Baosteel.
CSD shares were suspended Thursday afternoon pending release of price- sensitive information.
Prior to suspension, the stock was trading at HK$10.60, down 2.03 percent.
"China Railway Container will be our strategic partner to develop marine- railway transport. The agreement will not involve capital investment," CSCL's board secretary Ye Yumang told The Standard Thursday.
CSCL, an offshoot of the mainland's second-largest shipping company, currently moves containers by rail from three ports in China, Shanghai, Lianyungang and Dalian.
The marine-railway transport model can be more economical and environmentally friendly than road transport.
Its advantages become obvious over long distances, according to an industry insider. One train is capable of carrying 100 20-foot equivalent units, or TEUs, or the combined capacity of 20 container trucks.
As at the end of 2006, CSCL had a fleet of 151 vessels with total operating capacity of 399,176 TEUs. The company aims to expand its fleet to 170 vessels with capacity of 524,000 TEUs by the end of 2009 to take advantage of growth expected in Chinese exports.
"It is positive to the company in the long term," said Credit Suisse analyst Karen Chan.
However, she expressed concerns that railway infrastructure is still underdeveloped in China.
The central government will spend 3.8 trillion yuan (HK$3.83 trillion) on transport infrastructure under its 11th Five-Year Plan, up 73 percent from 2.2 trillion in the previous plan.
Shares of CSCL resume trading today after being suspended Thursday.
The stock closed Wednesday at HK$2.93, down 1.35 percent.
Meanwhile, CSCL's sister company China Shipping Development (1138) is expected to announce a strategic contract to transport raw materials for coal producer Shenhua Group after signing earlier deals with petroleum company Sinopec (0386) and steel firms Shougang and Baosteel.
CSD shares were suspended Thursday afternoon pending release of price- sensitive information.
Prior to suspension, the stock was trading at HK$10.60, down 2.03 percent.
