World’s largest container line stages a major rebound
November 11, 2010 - LM Editorial
A.P. Moller-Maersk has indicated that ocean cargo rates are not only firming up, but will remain robust in the coming year.
The Maersk parent is forecasting a record profit of around $5 billion in 2010 due to a ramped up demand for capacity.
Revenue for the period increased by 17 percent to $41.4 billion, primarily as a result of higher freight rates for the Group’s container shipping activities and higher oil prices. The net result for the period was a profit of $4.2 billion.
“The result is exceptional, and we are very satisfied,” said Group CEO Nils S. Andersen. “Markets have been favorable, but first of all, our businesses are in excellent shape. Especially our container business has improved and is ahead of competition on profitability. We are ready to seize opportunities, especially in emerging markets.”
The news also supports shippers’ contention that rates can be sustained without “talking agreements,” or virtual cartels.
“We remain adamant and dedicated to reforming the ‘Shipping Act,’” said Michael Berzon, chairman of the National Industrial Transportation League’s (NITL) ocean committee. “It will be high on our agenda at the upcoming national conference, and we are building support worldwide for this mission.”
Meanwhile, the A.P. Moeller expects a seasonal decline in both volumes and freight rates for the container activities towards the end of the year and consequently a somewhat lower result in the fourth quarter compared to previous quarters.
“The outlook for 2010 is subject to uncertainty,” admitted spokesemen. “Specific uncertainties relate to container freight rates, transported volumes, oil prices and the USD exchange rate.”