GERMAN shipping giant Hapag-Lloyd's annual report for 2023 and financial results for Q4 has revealed exactly how challenging the ocean container market.
The report notes that Liner Shipping revenues dropped 48.5 per cent to EUR17.7 billion (US$19.2 billion) from 2022 to 2023, and earnings before interest, taxes, depreciation and amortization fell by 77.1 per cent to EUR4.4 billion over the same period.
The ocean carrier grew its volumes slightly, from 11.8 million TEU to 11.9 million TEU, but the collapse of average freight rates from $2,863 per TEU to $1,500 per TEU meant that Hapag-Lloyd took in much less money for every box it moved, crushing its margins and profitability.
As a group - in other words, consolidated Liner Shipping and Terminal and Infrastructure results - Hapag-Lloyd managed to generate profits of EUR2.9 billion in 2023, down 82.6 per cent from EUR17 billion in 2022.
Hapag-Lloyd's 2023 results were still the third-best profitability result in the group's history, reports New York's FreightWaves.
CEO Rolf Habben Jansen was already painting a rosier picture adding that inventories were depleted worldwide, and the volumes were picking up nicely after the Lunar New Year. Peak season will come early this year, he predicted.
'I would also expect that peak season is going to start a little bit early,' Mr Habben Jansen told CNBC. 'I also expect that there'll be quite a number of people who tried to bring in their goods somewhere between June and August.'
If Mr Habben Jansen is right, though, soft conditions won't last long, and we may see elevated, peak-ish volumes as soon as early summer.
The thinking here is that while labour conditions at West Coast ports have stabilized since last year's contract negotiations, it's now the East and Gulf Coast ports' time to settle up with their unions.
Strikes are always on the table as dockworkers try to put pressure on port authorities prior to the signing of these important multiyear agreements, so shippers, Mr Habben Jansen believes, will try to move their goods into the country earlier rather than later.
SeaNews Turkey
The report notes that Liner Shipping revenues dropped 48.5 per cent to EUR17.7 billion (US$19.2 billion) from 2022 to 2023, and earnings before interest, taxes, depreciation and amortization fell by 77.1 per cent to EUR4.4 billion over the same period.
The ocean carrier grew its volumes slightly, from 11.8 million TEU to 11.9 million TEU, but the collapse of average freight rates from $2,863 per TEU to $1,500 per TEU meant that Hapag-Lloyd took in much less money for every box it moved, crushing its margins and profitability.
As a group - in other words, consolidated Liner Shipping and Terminal and Infrastructure results - Hapag-Lloyd managed to generate profits of EUR2.9 billion in 2023, down 82.6 per cent from EUR17 billion in 2022.
Hapag-Lloyd's 2023 results were still the third-best profitability result in the group's history, reports New York's FreightWaves.
CEO Rolf Habben Jansen was already painting a rosier picture adding that inventories were depleted worldwide, and the volumes were picking up nicely after the Lunar New Year. Peak season will come early this year, he predicted.
'I would also expect that peak season is going to start a little bit early,' Mr Habben Jansen told CNBC. 'I also expect that there'll be quite a number of people who tried to bring in their goods somewhere between June and August.'
If Mr Habben Jansen is right, though, soft conditions won't last long, and we may see elevated, peak-ish volumes as soon as early summer.
The thinking here is that while labour conditions at West Coast ports have stabilized since last year's contract negotiations, it's now the East and Gulf Coast ports' time to settle up with their unions.
Strikes are always on the table as dockworkers try to put pressure on port authorities prior to the signing of these important multiyear agreements, so shippers, Mr Habben Jansen believes, will try to move their goods into the country earlier rather than later.
SeaNews Turkey
