SOUTH Korea's 14 container carriers are to sign a memorandum of understanding tomorrow (August 8) to establish the Korea Shipping Partnership (KSP), the Korea Shipowners' Association said, according to a Pulse News report.

The carriers, which include South Korea's largest, Hyundai Merchant Marine (HMM), and newcomer SM Line, will cooperate to increase their collective strength through several measures, including increasing shared cargo capacity, adding new shipping routes and co-managing overseas terminals.

The KSP will establish operational guidelines by the end of the year, and aims to launch full-fledged operations in January, American Shipper reported.

The alliance is being formed with the aim of restoring the country's shipping reputation after its then-largest carrier, Hanjin Shipping, went bankrupt last year. Hanjin was the world's seventh largest carrier prior to going bankrupt.

Meanwhile, HMM is reportedly looking to allocate more vessels to meet rising demand on US routes in the coming months, the carrier said, according to a report from Yonhap News Agency.

HMM is projecting there will be a shortage of container carriers on the high-traffic routes from August to October as US customers want more products from China and Southeast Asia.

"As Maersk and MSC also deliver their products through our container carriers and vice versa on the US routes, we need to consult with them first," an HMM spokesperson said, according to Yonhap.

HMM agreed to a strategic cooperation with 2M Alliance members Maersk and MSC back in December involving a combination of slot exchanges and slot purchases between the liner carriers, although Maersk and MSC made it clear the agreement with HMM was "outside the scope" of the 2M Alliance.

HMM recently revealed its Asia-US West Coast volumes in June rose 77 per cent year over year, from 7,953 TEU per week to 14,055 TEU per week, according to PIERSData.