Thursday, April 22, 2010

Poor Container And Bulk Shipping Company Results Dribble In

CSCL and Tianjin Marine Shipping Report Losses for 2009
Shipping News Feature

CHINA – Unsurprisingly the state of container and bulk shipping for last year is once again illustrated by the latest results from shipping groups across the world. As we predicted in January, China Shipping Container Lines (CSCL) have released their figures for the period and, just as economy of scale works in favour for a company in good times, so it merely amplifies the losses when work dries up.

CSCL, with over 120 vessels China’s second largest container carrier and eighth biggest in the world, posted a $950 million loss compared to a small profit in 2008. The cargo turnover was 6,741,790 TEU, down only 3.7% but the decrease in revenue was a hefty 43.4% demonstrating how the slump in rates in the face of falling volumes generally have affected the trade.

A full report on the finances of CSCL can be viewed here and the company, like numerous others, are facing the future hoping that the across the board rate increases recently negotiated with its direct competitors will turn the situation around.

Meanwhile container and dry bulk line Tianjin Marine Shipping (TMSC) (part of the HNA airport to travel empire which manages 13 airports in mainland China), have reportedly lost almost $35 million in the past year of trading. The company specializes mainly in short sea container liner services and runs 12 vessels from its home port to Japan, Korea and Taiwan. In a similar position as that of CSCL the company saw operating income drop by over 50% once again having posted a small profit the previous year.

As the depressed economic circumstances in Europe and America have caused a general tightening of belts so Chinese exports to the regions have dropped dramatically and all the lines serving these areas are united in hoping that the downturn, which does appear to be slowly reversing for freight carriers, caused a unique set of circumstances which will not reoccur.

Photo:- CSCL’s “Dalian” (note the dolphin at the bow)