How hot is the consolidation market? Chinas container manufacturers have been scheduled to receive orders until February next year! A maritime advisory agency told reporters that the core reason for the current booming situation of the container transportation market is the relationship between supply and demand.
Demand recovery exceeds expectations
According to past experience, the proportion of the world economy transferring to the shipping economy is 1:10, that is, a 1% reduction in world economic growth will cause a 10% slowdown in the world shipping market. Fu Haiwei, a well-known logistics expert and vice president of the school of economics and management of Ningbo Institute of engineering, said.
However, the container shipping market in 2020 is somewhat different. The SCFI freight index stands above 3000 US dollars / feu for more than two months, and the high freight rate is rarely seen in history. At present, the shipping market even appears a box is difficult to find, which makes some professional institutions are greatly surprised.
Novel coronavirus pneumonia predicted that the transport demand will decline in April, and the worst case will even cause a tidal wave of Sea-Intelligence, or will bring a loss of $23 billion to the entire transportation industry. This figure is equivalent to the profit margin of the transport industry in the past 10 years. But by the end of August, the agencys reassessment had turned out to be quite different from the previous one, with the highest annual profit of $15.4 billion.
Although the data for September have not been released yet, the foreign trade data of July and August fully show that the demand recovery is far more than expected. Said Bao Zhang Jing, vice president of China shipbuilding industry comprehensive technology and Economy Research Institute.
According to China Customs data, Chinas foreign trade exports increased by 11.6% to 1.65 trillion yuan in August. According to the Ministry of communications, Chinas ports completed a container throughput of 24.06 million TEUs in August, up 6.4% year-on-year, 1.7% faster than last month.
However, the problem is not so simple, and the short-term shortage of shipping supply is not easy to solve. At the market level, Maersk, the worlds largest container carrier, admitted that there had been a shortage of containers in the market for months, especially for large containers with a length of 40 feet, due to the booming Pacific market. According to market news, shippers and logistics companies may have to wait up to four weeks to ship their containers from Asia to North America.
Its very profitable
Shipping company performance expected to exceed expectations
The performance of the shipping market beyond expectations also makes the share prices of A-share related stocks (such as COSCO Haikong) continue to fluctuate and rise. Can the prosperity of the market translate into the profits of the company?
Questions raised by some investors on the interactive platform for A-share container transportation companies
In this regard, most analysts have given optimistic expectations,
Bocom International released a report saying that COSCO Haikong believed its profit motive could be maintained under the pressure of strong freight, downward fuel price and lower cabin rental fee.
Yang Xin, managing director of Research Department of CICC and director of transportation and infrastructure research, believes that COSCOs performance in the third quarter exceeded expectations, and the level of freight support after the peak season is expected to exceed expectations, laying the foundation for the long-term contract negotiation next year.
In addition, Yang Xin believes that based on the current industry pattern (the concentration of container shipping industry has been greatly increased, and the share of the top ten transport capacity has increased from less than 60% 10 years ago to 83%), the market can expect the industrys profit center and valuation level to rise in the long term.