German carrier Hapag-Lloyd has revised its expected EBIT to $10.3 billion – $11.3 billion for 2021 from the earlier estimate of $7.5 billion – $9.5 billion. Based on preliminary figures, Hapag is likely to report an EBIT of $6.9 billion for the nine months ended September 2021 compared to $1 billion in the nine months of 2020.

“Due to unabated global demand for container transports and the continuing disruptions in global supply-chains causing a shortage of available transport capacity, Hapag-Lloyd posted very strong financial results in the first nine months of 2021,” an official statement said.

The final figures for the first nine months of 2021 will be published on November 12, 2021.

Hapag had posted an EBIT of $3.5 billion for the first half of the year on revenue of $10.6 billion. Revenue increased mainly because of a 46 percent higher average freight rate of $1,612/TEU compared to the H12020 freight rate of $1,104/TEU.

The freight rate development was the result of high demand combined with scarce transport capacities and severe infrastructural bottlenecks.

Volume was up only 4 percent to 6,004 TEUs compared to the previous year, which was impacted due to the Covid-19 pandemic.

“A roughly 6 percent lower average bunker consumption price, which amounted to $421 per tonne in the first half year of 2021 (H1 2020: $448 per tonne), had a positive impact on earnings.”

Hapag-Llyod has a fleet of 250 container ships and a total transport capacity of 1.8 million TEU.

Japanese carrier ONE had reported a profit of $6.8 billion for the first half of the year and is expecting to end the year with a profit of $11.8 billion.

Maritime consultancy Drewry has forecast a combined profit of $100 billion for container carriers in 2021 on higher freight rates.

Port congestion is building support for higher trans-Pacific premium rates in November, S&P Platts said in its recent update. While shipping lines prioritise China-US shipments, they are adding surcharges for other routes.

“Although Freight All Kinds rates were expected to remain flat, shipping lines were asking $10,000-$12,000/FEU for North Asia-to-West Coast North America shipments and $14,000-$16,000/FEU for the North Asia-to-East Coast North America route, including premium service fees.

“Shippers became more averse to paying premium rates earlier this month as their chances of getting goods on store shelves or in distribution centres for holiday shopping season were diminished by widespread US shortages of trucks, chassis, warehouse space and labour. Cargo owners were also concerned that power shortages in China would impact factory production and the earnings that supported high freight rates.”

The focus shifted this week to deliveries slated for early next year, the report said, as the North American supply chain buckled under the strain of cascading import volumes.

Source : ITLN