Shekou-Changsha container line to open Aug. 1

China Merchants' logistics division will begin running a dedicated container rail line between Shekou Container Terminal and the inland Chinese city of Changsha starting Aug. 1.

The line is anticipated to boost container flow between Shekou, one of the terminals in the Port of Shenzhen in South China, to Changsha, a growing interior city and capital of Hunan province, Lloyd's List reported Monday. Transit time on the rail connection will be 36 hours, according to China Merchants, whose terminal operating division owns a stake in Shekou.

Changsha is a regional manufacturing center with a focus on construction machinery and high-tech products with firms such as Mitsubishi, LG, Bosch and Hitachi, establishing a presence in the city, the article said. Nearby houzhou has a well-developed chemicals industry.

The port sees connections like this as a way to grow the hinterland from which the giant Shenzhen complex can draw cargo. Volume growth has slowed substantially this year, with Yantian, the biggest terminal in Shenzhen, seeing a decline in volume for the first time in its history. At Yantian, the problem has been slow transpacific traffic, as Yantian overwhelmingly handles import-export cargo and not transshipment. Other terminals in Shenzhen, like Shekou, handle more transshipment, intra-Asia and Far East/Europe trade and so volumes have still risen, though moderately.

As well as slowing demand from the United States, tougher labor laws and the revocation of export rebates have hit exporters in the Pearl River Delta region hard.