News Highlights week: 44 - 2021

The weekly offer, aptly marketed as ‘Myanmar Malaysia Service’ (MMS), will be operated with the 855 teu RESOLUTION and it is scheduled to start on 14 November from Port Kelang. By means of liking Yangon to the Malaysian transhipment hub of Port Kelang, SITC can connect Myanmar to its extensive Asian route network. 

SITC is furthermore about to enhance its portfolio of four weekly services between Port Kelang and China: In early November, the Chinese carrier will launch a new service connecting China, South Korea, the Straits and Thailand, advertised as 'FEM2' and jointly operated with ONE, Yang Ming and KMTC.

Charter market: rates for short charters take a dive
After several slow weeks, the container charter market got busier in the past fortnight, with an increase in the number of period fixtures concluded, despite a continued shortage of ships across the board. 

Activity was especially on the rise in the large tonnage (5,500 teu and above), Classic Panamax (4,000-5,299 teu) and sub-2,000 teu segments, with most fixtures in the bigger sizes concluded for vessels coming open in 2022. 

The number of deals agreed for periods of 36 to 60 months was still substantial, with charter rates globally stable. 

However, the number of short-term charters concluded at sky-high levels by freight forwarders and new liner shipping entrants on prompt tonnage has been gradually receding, with charter rates for these ad-hoc employments taking a serious hit. 

Illustrating this, a 4,892 teu ‘classic panamax’ unit was extended for a 3-4 month' employment at ‘only’ USD 125,000 per day, a level that compares poorly with the USD 200,000 that slightly smaller 'handy' panamax tonnage of 4,250 teu was obtaining in early September for similar durations. 

The same trend is being observed on smaller ships of 1,700 teu which are now obtaining ‘only’ USD 70,000 per day for short charters of 2-3 months, versus USD 100,000 per day and over, back in September. The carriers behind these opportunistic employments are clearly becoming wary of growing uncertainties on the cargo front, with spot freight rates no longer rising and volumes expected to soften at the end of the current peak season. 

Pricy bunkers and crippling congestion issues around the world that increasingly dent profits are also a mounting concern.

Maersk posts group profit of USD 5.5 bn 

Maersk Group delivered a record net profit of USD 5.46 bn for the third quarter after EBIT (earnings before interest and taxes) for Ocean activities jumped 50% versus the previous quarter. 

Widespread network disruption, congestion, and increased demand drove up freight rates, while the company capitalised by adding more capacity. Alphaliner currently shows a fleet of 4.26 Mteu for Maersk versus 4.11 Mteu at end June.

Earnings gains were almost entirely due to higher short and longterm freight rates. Maersk will log an approximate 50% increase in long-term rates (or approximately USD 1,000 per FFE) in 2021, with a further moderate rise expected in 2022. 

ONE to rake in USD 12 bn in fiscal 2021 

Japanese carrier ONE reported a record net profit of USD 4.2 bn for the latest quarter, and expects total net earnings for fiscal 2021 (April 2021-March 2022) to reach a staggering USD 12 bn. 

MKT