AXS-Alphaliner Newsl..

Liftings in M teu
% Increase
ALPHALINER Weekly Newsletter 2009-Week 17
axs-alphaliner.com – the worldwide reference in liner shipping
5.793 5.709
1%
COSCON
Volume Growth
2006-2008
12%
5.111
13%
2008 2007 2006
Dely Teu Shipyard
Jan-09 10,020 Nantong (NACKS)
Jun-09 5,100 Jiangnan Changxing
Jun-09 5,100 Jiangnan Changxing
Sep-09 5,100 Jiangnan Changxing
Sep-09 5,100 Jiangnan Changxing
Jan-10 1,800 Dalian Shipyard
Jan-10 1,800 Dalian Shipyard
Jan-10 1,800 Dalian Shipyard
Jan-10 1,800 Dalian Shipyard
Feb-10 5,100 Jiangnan Changxing
Feb-10 5,100 Jiangnan Changxing
Jun-10 5,100 Jiangnan Changxing
Jun-10 5,100 Jiangnan Changxing
Sep-10 5,100 Jiangnan Changxing
Sep-10 5,100 Jiangnan Changxing
Dec-10 5,100 Jiangnan Changxing
Dec-10 5,100 Jiangnan Changxing
Jul-11 4,250 Jiangsu New YZJ
Aug-11 4,250 Jiangsu New YZJ
Sep-11 4,250 Jiangsu New YZJ
Oct-11 4,250 Jiangsu New YZJ
Nov-11 4,250 Jiangsu New YZJ
Dec-11 4,250 Jiangsu New YZJ
Jan-12 4,250 Jiangsu New YZJ
Jan-12 4,250 Jiangsu New YZJ
Feb-12 4,250 Jiangsu New YZJ
Mar-12 4,250 Jiangsu New YZJ
Apr-12 4,250 Jiangsu New YZJ
May-12 4,250 Jiangsu New YZJ
Jun-12 4,250 Jiangsu New YZJ
Jul-12 4,250 Jiangsu New YZJ
Jul-12 4,250 Jiangsu New YZJ
Aug-12 4,250 Jiangsu New YZJ
Sep-12 4,250 Jiangsu New YZJ
Oct-12 4,250 Jiangsu New YZJ
Nov-12 4,250 Jiangsu New YZJ
Dec-12 4,250 Jiangsu New YZJ
2012 13,350 Nantong (NACKS)
2012 13,350 Nantong (NACKS)
2012 13,350 Nantong (NACKS)
2013 13,350 Nantong (NACKS)
2013 13,350 Nantong (NACKS)
2013 13,350 Nantong (NACKS)
2013 13,350 Nantong (NACKS)
2013 13,350 Nantong (NACKS)
Operating profit for COSCO’s liner shipping business under COSCON
dropped by 82.4% to RMB 292 M ($43 M) in 2008 compared to RMB 1,656 M
($242 M) in 2007. Total liftings grew by only 1.5% to 5.79 Mteu despite a
significant increase in vessel capacity which grew from 435,138 teu at the
end of 2007 to 496,317 teu, an increase of 14%. Utilisation levels dropped
across all the trade segments, with load factors on its three key
international segments of Transpacific, Asia-Europe and Intra-Asia falling
by 5% on the headhaul legs. Average rates were down by 6.4% overall with
the Asia-Europe trade suffering the worst drop of 14.9% in 2008.
The container shipping operations by COSCON contribute 33% of the
group’s revenue and 2% of its operating profits. The liner shipping segment
suffered the greatest slump of all of COSCO’s business units which also
includes dry bulk shipping, logistics, terminals and container leasing.
COSCO has a large orderbook of 59 container vessels due for delivery
between 2009 and 2013. These ships have a total capacity of 445,000 teu.
Deliveries this year would include nine new vessels, thereof four owned
5,100 teu ships and one owned 10,020 teu vessel and furthermore one
4,506 teu and three 8,495 teu chartered-in vessels.
The company said that due to poor market conditions it “is negotiating
with shipowners to postpone the delivery in 2010 of the three 8,495 teu
vessels planned for 2009.” They are part of a series of eight 8,495 teu
ships fixed for 12 years from Seaspan, which ordered them in 2007.
Seaspan also has eight more ships of 13,092 teu fixed to COSCO for
delivery between 2010 and 2011.The bulk of COSCO’s newbuildings are on
its own account, with 37 ships due to be delivered by 2013. These include
eight 13,350 ships ordered at Nantong Shipyard (NACKS) for delivery in
2012-2013.
The company said that it was able to “increase its market presence
without sacrificing its service quality” by integrating routes and slot sales
to cope with the slowdown in demand. It has also established a “CKYH
Task Force to fully utilise the resources of the consortium for optimizing
the allocation of shipping capacity for each route and reducing the
operational risks through various measures, including early termination of
charters, vessel repairs, service suspensions during off-seasons, and route
capacity reduction.”
The carrier has embarked on a cost savings program that had included
slow steaming of vessels on 17 routes last year. It has also negotiated
lower rates with its suppliers and reduced its stock of containers and
chassis units, which it will continue to implement in 2009.
The company offered some hope for a recovery “with the economic
stimulus policies launched by various countries and the decrease in
inventories of retail stores, the container shipping market will revive when
the US and European economies and trades recover.” Despite this, COSCO
estimates that its full year liftings will drop by 9.6% to 5.235 Mteu.
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