Maritime Market News
News Highlights week: 11 - 2024
Ngày đăng: 18/03/2024 | Lượt xem: 173
Yang Ming posts net operating loss for 2023
Yang Ming, Taiwan’s second largest carrier, posted a net operating loss of –TWD 1.7 bn (–USD 53.4 M) for 2023 following a year of ‘inflation and economic slowdown’. The line nevertheless managed to report a positive result at the bottom line.
Lower freight rates cut Yang Ming’s annual revenues by 63% year-on-year, to TWD 140.6 bn.
However, it reported a net profit for the year of TWD 4.7 bn, albeit this represented a 97% decrease on the TWD 180.6 bn profit logged in 2022.
In light of the Red Sea crisis and the Panama Canal drought restrictions, Yang Ming said its primary strategy last year was on maintaining stable services and safe navigation.
Going forward, it is focusing on strengthening the business strategy, adjusting its service network, and refining network fleet planning.
Although the IMF recently raised its outlook for global economic growth by 0.2% to 3.1% for 2024, Yang Ming warned of persistent uncertainties this year. The IMF is predicting similar growth, at 3.2%, in 2025.
Red Sea crisis: rate hikes exceed cost increases
Diversions around the Cape of Good Hope have increased shipping companies’ operating costs by approximately 50% - considerably less than rate rises seen in the same period, according to ratings agency Fitch.
Fitch, which acknowledged the crisis in the Red Sea was lasting longer than expected, said the conflict would positively affect carrier’s short-term profitability, especially as higher spot rates would also influence this year’s contract prices.
In the spot market, rates on Asia–Europe routes have increased by around 285% since early October, and more than doubled on other main East West lanes.
Foto: AFP
Although disruption in the Red Sea plus problems in the Panama Canal are not expected to bring structural changes to the market, they could keep freight rates ‘higher for longer’.
While inflation in operating expenses, higher port charges and the cost of meeting environmental regulations will cut into carriers’ profits, these factors could also help to prop up freight rates once the Red Sea crisis is over.
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