Philippines Send First Ship in 45-Years to U.S. to Fill Shipping Gap

The Philippines has become the latest to confront the constraints in shipping that occurred in 2021 by launching its own shipping service to the United States. A Philippine-registered vessel is departing for the first time in 45 years for a nonstop voyage to the United States transporting containers and goods from the island nation.

The 13,750 dwt containership Iris Paoay, operated by the Iris Logistics company of the Philippines, began loading containers last week. Departing Manila, the vessel is making interim stops in Cebu and Davao before beginning the 27-day journey to Long Beach, California. The vessel, which was built in 2006 and acquired by Iris Logistics’ parent company Royal Cargo in 2017, has been operating interisland in the Philippines. It has a capacity of 1,100 TEU with 22 reefer slots.

The project to commence direct cargo service to the United States is said to be in response to high international shipping costs the Philippines had been incurring, as well as the lack of space on vessels bound for the U.S. in 2021. Reports from the Philippines said that like many other exporters, the country has been struggling to ship its goods with manufacturers hard hit by the lack of containership capacity and growers seeing their crops rot before they could get them to market. Additionally, importers reported delays in receiving materials, especially in the electronics manufacturing industry. The country has also been concerned about food insecurity due to constraints on its imports.

The U.S. Agency for International Development (USAID) worked with the Philippines’ Export Development Council (EDC) and the University of the Philippines Public Administration Foundation to find solutions to the shipping challenges the Philippines have been experiencing. The idea to place a domestic cargo ship into international trade also required the support of the Department of Trade and Industry due to maritime regulations that limit ships’ authorization to move between trades.

The shipping company said that it was already organizing a second departure for a reefer vessel in early October. In addition, the Chairman of the EDC Networking Committee on Transportation and Logistics said that they believed this initiative has inspired other local shipping lines to also consider providing regional intra-Asia and trans-Pacific shipping services.