China Shipping makes profit, withdraws sailings
China Shipping Container Lines has posted a Yuan 991m ($158.7m) net profit for the third quarter after a turnaround in the second quarter saw it return to the black.
The company’s net loss for the first nine months narrowed to Yuan 290m. CSCL, the world’s ninth-largest box liner by capacity, lost Yuan2.9bn last year, but has made profits since the second quarter. CSCL did not predict a full year loss.
As of September 30, cash and bank balances increased 73% to Yuan 12bn, due mainly to a surge in short-term borrowings, from Yuan 819m to Yuan 3bn.
Negative net cashflow from operations for the first nine months were down to Yuan2.1bn from Yuan3.7bn last year.
CSCL has also announced that it will skip two sailings on its Asia-North Europe AEX1 during November, dropping services during weeks 45 and 48.
The two pulled sailings, joining three services suspended earlier—the CKYHNE4, the G6 Loop 3 and Maersk’s AE-9 — will remove around 40,000 teu from the Asia-North Europe route during the first week of November.
The figure represents 15% of the total weekly capacity on the trade versus the weekly trade capacity in September, according to box-analyst Alphaliner.
Alphaliner said the cuts appear to have had “a positive impact on carriers’ plans to raise Far East-Europe freight rates by $500 per teu on 1 November”.
However, “the ad hoc void sailings announced so far are still insufficient to reduce the oversupply challenges on the trade,” Alphaliner said.
Spot freight rates reported by the Shanghai Containerised Freight Index on 26 October jumped by $241 per teu to $1,315 per teu, reversing 12 consecutive weeks of rate reductions.
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