Container Shipping Demand Remains Good: Hapag-Lloyd

 

As a result, the container shipping industry’s medium-term growth prospects remain intact, says the company in its investor outlook for 2017.

 

In its latest economic outlook (April 2017), the International Monetary Fund (IMF) expects global economic growth to reach 3.5% in the current year. 

 

This forecast means that the global economy is set to grow at a slightly faster rate in 2017 than in the previous year (+3.1%). According to the IMF, the volume of global trade, which is key to the demand for container shipping services, will increase by 3.8% in the current year (2016: +2.2%).

 

IHS Global Insight (February 2017) is forecasting that the global container shipping volume will increase by 3.7% to approximately 137 million TEU in 2017 (2016: 2.5%). 

 

Following a rise in transport capacities of approximately 0.3 million TEU to 20.0 million TEU in 2016, Drewry forecasts a nominal increase in transport capacities of up to approximately 1.5 million TEU for the current year. The further growth in supply capacity could make it difficult once again to push through freight rate increases in 2017.

 

Based on unchanged optimism about the general economic and sector-specific conditions, Hapag-Lloyd (excluding the integration of UASC’s business activities) continues to expect its transport volume to increase moderately.

 

A significant rise in the average bunker consumption price and a moderate improvement in the average freight rate are anticipated in 2017. If final synergy effects from the original efficiency programmes are achieved, along with additional cost savings, the expected improvement in the quality of earnings, the anticipated growth in volumes and a return to a better peak season in 2017, Hapag-Lloyd is forecasting a substantial increase in its EBITDA and EBIT in 2017.