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CHINA's largest container line, Cosco Shipping Holdings, indicated optimism about the shipping market's second half due to a resurgence in transpacific and Asia-Europe freight rates, reports New York's Journal of Commerce.
However, the company maintained a cautious stance in its interim earnings announcement, citing challenges such as global economic and trade landscape changes, inflationary pressures, and new vessel deliveries.
Cosco Shipping observed that the container market swiftly returned to normal in the first half of the year after the supply chain disruptions of the previous two years.
This brought challenges like increased vessel capacity as port congestion eased and weakened cargo demand due to destocking.
Reflecting these dynamics, the company reported its lowest financial figures since 2020.
In the first half of 2023, total net profit attributable to equity holders plummeted 74 per cent to US$2.3 billion compared to H1 2022.
Revenue also declined 57 per cent to $12.7 billion, with $7.5 billion from Cosco Shipping Lines and $4.5 billion from subsidiary Orient Overseas Container Line (OOCL).
Cosco Shipping noted an 8.6 per cent decrease in total container volumes to 11.4 million TEU during the first half, down from 12.4 million TEU in the previous year.
The largest revenue drop occurred in the transpacific trade, falling 69 per cent to $2.8 billion, with liftings declining 14.5 per cent to 2.1 million TEU.
Revenue on Asia-Europe and Mediterranean routes declined 66 per cent to $2.5 billion, while liftings eased 6.7 per cent to 2.2 million TEU.
Despite these challenges, the company highlighted the significance of its chassis and logistics-related operations.
Revenue from non-maritime supply chain services reached $2 billion in the first half, an 8.2 per cent increase from the previous year, accounting for just over 16 per cent of revenue from its container shipping business.
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