Due to excess capacity and decline in demand, the profit of the container carrier will decrease by 8
- Author:Elena
- Release Date:2022-09-05
A analysis released by HSBC (HSBC) stated on Thursday that due to excess capacity and decline in demand, container transportation is entering a decline cycle, which will lead to a decline in the profit of the carrier of more than 80%in the next two years.
In an industry research report, HSBC said that the market downturn is "inevitable" and may bottom out in 2024, and the profit will be reduced by more than 80%compared with the peak in 2022.
The bank said that it is interesting whether the shipping company has learned from history, which pointed out that about ten years ago, the severe overcapacity brought by the shipping company caused price wars and huge losses.
"Signs show that due to the continuous expansion of supply and demand gaps, the spot freight rate may drop rapidly to the level before the epidemic." HSBC's research supervisor said.
However, the contract price will still be at a higher level than before the epidemic, and the spot freight rate that has been steadily declining for several months will not break through the bottom line. HSBC said that the container liner company will impose restrictions on capacity management.
"Overall, we expect the industry to be profitable, not losses before the epidemic."
Due to excess capacity and decline in demand, the profit of the container carrier will decrease by 80% in the next two years
Picture source: pexels
After the shipping company's record in the first half of the year, the container shipping industry is enjoying the highest level of profit ever ever. Druori predicted in the first half of the year that the operating profit of the container shipping industry in 2022 will reach $ 300 billion. But since the beginning of this year, the spot freight rate has dropped sharply from a record high in 2021.
In addition, HSBC estimates that global container transport volume will drop by 2%in 2022, 3%in 2023, and then resume 2.5%in 2024. The bank is expected to increase by 6.2%, 6.5%, and 8%in 2022, 2023 and 2024, respectively, and the profit of Bander operators will bottom out.
As of the end of June, the orders of container ships accounted for nearly 27%of the total global fleet, the highest level since 2009, and the total order capacity was 6.6 million TEU. Although the major Western markets are facing huge economic uncertainty, most ships will be delivered in the next two years.
In the second quarter financial report conference with analysts, the shipping company pointed out a series of contradictory signals, including inflation and rising interest rates in Europe and the United States, and the stable demand for imported goods by the United States. The prospect of transportation was covered with shadows.
However, European demand has deteriorated more obvious than the United States. The inflation rate of the European Union in July reached 9.8%, the highest level in 25 years, and the decline in consumer expenditure has promoted the increase in inventory of the entire European continent.
In the first half of this year, it can be seen from China's container imports in China's largest trading partner in China. According to the latest data from the Container Trade Statistics Bureau (CTS), compared with the first half of 2021, the import volume from China in the first half of this year was 3.84 million TEU, a decrease of nearly 5%. The last month.
In an industry research report, HSBC said that the market downturn is "inevitable" and may bottom out in 2024, and the profit will be reduced by more than 80%compared with the peak in 2022.
The bank said that it is interesting whether the shipping company has learned from history, which pointed out that about ten years ago, the severe overcapacity brought by the shipping company caused price wars and huge losses.
"Signs show that due to the continuous expansion of supply and demand gaps, the spot freight rate may drop rapidly to the level before the epidemic." HSBC's research supervisor said.
However, the contract price will still be at a higher level than before the epidemic, and the spot freight rate that has been steadily declining for several months will not break through the bottom line. HSBC said that the container liner company will impose restrictions on capacity management.
"Overall, we expect the industry to be profitable, not losses before the epidemic."
Due to excess capacity and decline in demand, the profit of the container carrier will decrease by 80% in the next two years
Picture source: pexels
After the shipping company's record in the first half of the year, the container shipping industry is enjoying the highest level of profit ever ever. Druori predicted in the first half of the year that the operating profit of the container shipping industry in 2022 will reach $ 300 billion. But since the beginning of this year, the spot freight rate has dropped sharply from a record high in 2021.
In addition, HSBC estimates that global container transport volume will drop by 2%in 2022, 3%in 2023, and then resume 2.5%in 2024. The bank is expected to increase by 6.2%, 6.5%, and 8%in 2022, 2023 and 2024, respectively, and the profit of Bander operators will bottom out.
As of the end of June, the orders of container ships accounted for nearly 27%of the total global fleet, the highest level since 2009, and the total order capacity was 6.6 million TEU. Although the major Western markets are facing huge economic uncertainty, most ships will be delivered in the next two years.
In the second quarter financial report conference with analysts, the shipping company pointed out a series of contradictory signals, including inflation and rising interest rates in Europe and the United States, and the stable demand for imported goods by the United States. The prospect of transportation was covered with shadows.
However, European demand has deteriorated more obvious than the United States. The inflation rate of the European Union in July reached 9.8%, the highest level in 25 years, and the decline in consumer expenditure has promoted the increase in inventory of the entire European continent.
In the first half of this year, it can be seen from China's container imports in China's largest trading partner in China. According to the latest data from the Container Trade Statistics Bureau (CTS), compared with the first half of 2021, the import volume from China in the first half of this year was 3.84 million TEU, a decrease of nearly 5%. The last month.