{"id":81135,"date":"2024-09-19T00:00:00","date_gmt":"2024-09-19T00:00:00","guid":{"rendered":"https:\/\/enterpriseam.com\/logistics\/2024\/09\/19\/the-global-container-shipping-industry-saw-record-income-in-2q-2024\/"},"modified":"2024-09-19T00:00:00","modified_gmt":"2024-09-19T00:00:00","slug":"the-global-container-shipping-industry-saw-record-income-in-2q-2024","status":"publish","type":"post","link":"https:\/\/enterpriseam.com\/logistics\/2024\/09\/19\/the-global-container-shipping-industry-saw-record-income-in-2q-2024\/","title":{"rendered":"The global container shipping industry saw record income in 2Q 2024"},"content":{"rendered":"

The global container shipping industry registered an 87.7%<\/strong> y-o-y surge in <\/strong>net income to USD 10.2 bn in 2Q 2024<\/strong>, with projections for another climb in 3Q 2024, according to a report (pdf)<\/a> by shipping expert John McCown (LinkedIn<\/a>). The upward trend is a reversal of a series of downward earnings for six quarters from the last earnings peak of USD 64.1 bn in 2Q 2022, so what is causing the rise?<\/p>\n

(** Tap or click the headline above to read this story with all of the links<\/strong> to our background and outside sources.)<\/p>\n

The big catalyst:<\/strong> Red Sea disruptions have resulted in the diversion of most Asia-to-Europe container vessels to the longer route around Africa. This key lane represents some 25% of global container miles and a one-third increase in typical voyage distance, resulting in an 8% contraction in worldwide capacity. <\/p>\n

There are ripple effects: <\/strong>The Red Sea crisis has negatively affected the earnings of several Asian firms in 1H 2024, particularly those who rely on exports, Bloomberg<\/a> reported last week. \u201cWe believe rates will return to below breakeven once supply chains normalize, due to the structural challenges facing the industry,\u201d Bloomberg Intelligence analysts said, highlighting that the supply and demand gap will likely weigh on the outlook for container rates and liner earnings. <\/p>\n

Transportation companies are benefiting from the higher freight rates<\/strong>, with most seeing a boost in net income for the quarter. Denmark\u2019s Maersk and Chinese shipping firm Cosco Shipping Holdings saw a boost in net income, almost doubling from 1Q 2024 and surpassing the USD 8.88 bn from 2Q 2023.<\/p>\n

Shifting fortunes:<\/strong> Orient Overseas International<\/a> \u2019s transpacific trade route saw improved performance from higher freight rates. Port operator China Merchant Port Holdings saw an increase in transhipment cargoes in its Sri Lanka ports, while Adani Ports recorded a rise in overall volumes. <\/p>\n

Who benefited the most? <\/strong>Carriers that are more concentrated in the key east-west trade lanes of Asia-Europe and Asia-North America showed the most robust improvement in the quarter. <\/p>\n

In numbers: <\/strong>Worldwide container volumes rose 6.1% y-o-y in 2Q 2024, a slight pullback from the 8.3% y-o-y increase in 1Q, data from Container Trade Statistics showed. The worldwide loaded TEU volume \u2014 which accounted for 46.4 mn \u2014 in 2Q was up 7.5% y-o-y, the highest worldwide volume quarter ever and 0.5% the previous record of 2Q21 rates. US demand soared high, loading 8.5 mn TEUs in 2Q at an 11.4% y-o-y increase and a 4.6% increase from 1Q 2024. <\/p>\n

Here\u2019s what to expect: <\/strong>\u201cBased on where I anticipate the CTS global pricing index to come in for 3Q 2024, my current estimate in the industry will earn USD 14.7 bn in 3Q 2024 on revenue of USD 78.4 bn \u2026 At those levels, the 3Q 2024 will represent a y-o-y increase of 26.9% in revenue, 425% in net income,\u201d McCown writes in the report, adding that \u201cthe fourth quarter would fall somewhere between the second and third quarters.\u201d <\/p>\n","protected":false},"excerpt":{"rendered":"

3Q and 4Q 2024 are projected to yield high earnings<\/p>\n","protected":false},"author":1,"featured_media":81136,"comment_status":"","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"newspack_ads_suppress_ads":false,"newspack_popups_has_disabled_popups":false,"newspack_sponsor_sponsorship_scope":"","newspack_sponsor_native_byline_display":"inherit","newspack_sponsor_native_category_display":"inherit","newspack_sponsor_underwriter_style":"inherit","newspack_sponsor_underwriter_placement":"inherit","ep_exclude_from_search":false,"_primary_brand":0,"newspack_featured_image_position":"","newspack_post_subtitle":"","newspack_article_summary_title":"Overview:","newspack_article_summary":"","newspack_hide_updated_date":false,"newspack_show_updated_date":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[255],"tags":[123,254],"brand":[],"newspack_spnsrs_tax":[],"class_list":["post-81135","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-the-macro-picture","tag-shipping-maritime","tag-the-macro-picture","wpautop","entry"],"acf":{"mongo_id":"db24a5e4-c3df-4990-b925-a735a325025f","order":"7","is_powered_by":false,"story_type":"1","photo_url":"https:\/\/ent.news\/2024\/9\/1552.jpg","photo_position":"above","homepage_title":"","full_issue_title":"The global container shipping industry saw record income in 2Q 2024","related_issue":[81124],"teaser":"3Q and 4Q 2024 are projected to yield high earnings","voice_url":"https:\/\/s3.us-east-1.amazonaws.com\/ent.news\/audio\/2024\/9\/.e01a0a9a-c42e-478a-a70a-69a943968572.mp3"},"yoast_head":"\nThe global container shipping industry saw record income in 2Q 2024 - 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