A MYSTERIOUS new carrier has set sail in the perilous Red Sea lanes, seeking to capitalise on the turbulence caused by the Houthi militia.

The recently formed Chinese shipping company, Sea Legend Shipping, has swooped in to grab a slice of the high-risk, high-reward market by snapping up secondhand vessels last December, sources said.

The new carrier appears aiming to fill the void left by mainstream carriers who retreated from the vital Asia-Europe route because of the escalating attacks on merchant ships off the coast of Yemen.

Analysis by Lloyd’s List has already found China-linked tonnage, at least in container shipping, accounts for a markedly higher proportion of passages, in part because China’s good relations with Iran and influence in the region are seen to boost security for such vessels.

According to a certificate issued by China’s Ministry of Transport displayed on Sea Legend’s website, the Singapore-incorporated firm obtained approval in February 2023 to operate international container liner services calling at the country’s ports.

It operates a fleet of 10 self-owned vessels ranging from 1,800 teu to 4,900 teu, totalling 32,750 teu.

This scale would rank Sea Legend 46th among Alphaliner’s top 100 carriers globally. But the company’s name is absent from the well-known, promptly updated list, indicating its rapid expansion is recent.

Its latest published schedule lists seven vessels plying services from China via the Red Sea to Türkiye. They are Zhong An Xin Hua Yuan (IMO: 9252242), SFT Saudi, TB Anping, SFT Turkey (IMO: 9238753), OVP Taurus (IMO: 9241205), OVP Aries (IMO: 9150195) and SFT China.

The SFT-prefixed ships were said to be purchased just last month, while vessel ownership data indicates TB Anping’s registered owner changed to Baohua Shipping at the beginning of this year having previously been owned and operated by Taiwan’s Wan Hai Lines.

These vessels are scheduled to depart one after another from Qingdao between January 13 and February 5, calling at Chinese ports such as Shanghai and Nansha, before reaching Red Sea ports including Djibouti, Jeddah, Sokhna and Aqaba, then transiting the Suez to Istanbul.

The first to sail, 4,200 teu Panama-flagged Zhong An Xin Hua Yuan, is crossing the South China Sea near Vietnam, expected to arrive in Djibouti on February 5.

Lloyd’s List Intelligence tracking shows several others — 2,442 teu OVP Aries (IMO: 9150195), 2,824 teu OVP Taurus (IMO: 9241205), 4,051 teu SFT Turkey (IMO: 9238753) — called at Russia’s St. Petersburg and Bronka ports in December, although it is unclear if they were already under Sea Legend’s control. All three have since crossed the Red Sea returning to China.

Sea Legend claims to provide “ultimate care for crew, cargo and vessel with high security level” for Red Sea transits. This includes escorts by the Chinese navy and private armed guards on board.

China-linked ships passing Yemeni waters are often seen emphasising their Chinese identity in Automatic Identification System descriptions, such as “All Chinese” or “Chinese company”, even hoisting the national flag, to mitigate the threat of attack.

The company’s website suggests its ship SFT Turkey received protection from a naval vessel around December 26 while traversing the Bab el Mandeb Strait.

China’s navy has maintained a presence in the Gulf of Aden and Somali basin with escort flotillas since December 2008, mainly for anti-piracy purposes. Its latest batch of ships comprising a guided missile destroyer, frigate and supply vessel departed in September 2023, according to state-owned Xinhua News Agency.

Container shipping industry sources linked Sea Legend to another emerging Chinese carrier, Transfar Shipping, which capitalised on entering the transpacific services when the pandemic drove a market boom.

Setting up a separate brand could isolate risk in case any vessels are actually hit while crossing the Red Sea, said one of them.

Local media reports and industry sources indicate that Shanghai-based Worldwide Logistics, in which Chinese e-commerce giant Alibaba’s logistics arm Cainiao has a 13.5% stake, is the parent company of Transfar. However, both companies have denied any connection between each other. 

According to Singapore’s Accounting and Corporate Regulatory Authority, Sea Legend’s shareholder is a company called Sea World Legend Holdings Ltd, incorporated in the British Virgin Islands. It shares an identical address with Transfar’s shareholder, Transfar Marine Holdings Ltd.

A senior executive at Transfar confirmed to Lloyd’s List it also operates and manages Sea Legend, without further comment.

Among leading carriers, only CMA CGM has openly said some of its ships will continue sailing the Red Sea under French naval protection. Two 14,000 teu containerships of China’s Cosco Shipping were also tracked entering the area and calling the company’s invested Red Sea Gateway Terminal in Jeddah.

According to Lloyd’s List Intelligence statistics, containership volumes traversing the Red Sea have fallen around 70% since early December amid the increasing threat from the Houthis.

An executive at a Chinese container line said the reduced route density appears to offer opportunities for more daring newcomers, although the region’s fluid situation creates high uncertainty around both ship security and cargo demand.