P&O Ferries is to close its Liverpool-Dublin route after failing to reach agreement on a new contract with Port of Liverpool operators Peel Ports.

The ferry operator principally ships unaccompanied freight between the two ports, raising fears that the cost of shipping freight to and from Ireland will become more expensive.

P&O said Peel had told the shipping company that its current berth would not be available after the end of this year.

It added: “Without agreement with the port owner to provide a berth in Liverpool, it is impossible for P&O Ferries to continue operating on this route.”

The operator said it had conducted “ extensive negotiations” with Peel Ports to extend its lease at the port or find an alternative site for its Liverpool-Dublin service to operate, but these had been “unsuccessful”.

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P&O warned that the closure of the route will “reduce competition and the choice of sailings available to customers on a crossing where there is currently only one alternative operator". Currently two vessels sail the route 24 times a week. The company said it will redeploy the ships to other parts of its network.

Peel Ports has confirmed the P&O service would no longer call into Liverpool once the existing contract expires at the end of this year. This leave Seatruck Ferries as the only other company serving the Dublin-Liverpool route, unless another ferry operator is appointed to replace the P&O service.

Mick Lynch, the RMT's general secretary, called for the government to “scrap any shipping contracts they have with P&O and begin the process of banning them from operating in UK waters, as a matter of urgency".

He added that the operator "cannot be trusted to operate economically vital ferry services" and accused the company’s management of "blaming everyone else but themselves for their abject failures".

In March last year P&O Ferries was condemned by the government for executing a mass sacking of staff working on its ferries out of Dover, which saw over 700 staff lose their jobs with the roles filled by agency staff on lower pay and reduced working conditions.