Yang Ming Marine Transport Corp (陽明海運) yesterday gave a rosy outlook for the first half of this year on expectations that container shipping rates would remain high.
A combination of a shortage of empty containers and traffic congestion at ports worldwide due to the COVID-19 pandemic is expected to keep freight rates high until the end of June, Yang Ming president Patrick Tu (杜書勤) told an investors’ conference in Taipei.
Yang Ming is Taiwan’s second-largest container shipper by fleet size.
Photo: Wang Yi-hung, Taipei Times
It has negotiated new annual long-term contracts for its routes from Asia to the US with some of its clients, Tu said, adding that contract rates and capacity ordered by clients rose from a year earlier.
Yang Ming’s operations from Asia to the US made up 42 percent of its total revenue last year, followed by its operations in Europe with 32 percent and Asia with 26 percent, company data showed.
The shipping industry has had an oversupply problem over the past few years, but the issue would be resolved this year, Tu said, citing forecasts by maritime research firms such as London-based Drewry Shipping Consultants Ltd and Clarkson PLC.
Drewry has forecast that supply for container capacity would grow 4.5 percent this year and demand would rise 8.9 percent, while Clarkson projected a 3.8 percent gain in supply and 5.4 percent rise in demand, Tu said.
Whether Yang Ming would sustain its profit momentum in the second half of this year is still unclear, as it would depend on the pandemic and fuel costs, Tu said.
Overall, Yang Ming is optimistic about turning a profit, he said.
The company yesterday reported an average freight rate of US$1,140 per twenty-foot-equivalent unit (TEU) at the end of last year, up 50 percent from US$759 a year earlier, while its average fuel cost dropped 31 percent annually to US$321 per tonne.
Asked if the Suez Canal being blocked by the MV Ever Given container ship has affected Yang Ming’s operations, Tu said two Yang Ming vessels have turned south to sail around the Cape of Good Hope.
Although the change in course would add seven to 10 days to the shipping time, Yang Ming would not need to compensate its clients according to global maritime law, he said.
Yang Ming shares rose 3.68 percent to NT$35.25 in Taipei trading yesterday.
Taiwan’s technology protection rules prohibits Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) from producing 2-nanometer chips abroad, so the company must keep its most cutting-edge technology at home, Minister of Economic Affairs J.W. Kuo (郭智輝) said yesterday. Kuo made the remarks in response to concerns that TSMC might be forced to produce advanced 2-nanometer chips at its fabs in Arizona ahead of schedule after former US president Donald Trump was re-elected as the next US president on Tuesday. “Since Taiwan has related regulations to protect its own technologies, TSMC cannot produce 2-nanometer chips overseas currently,” Kuo said at a meeting of the legislature’s
TECH WAR CONTINUES: The suspension of TSMC AI chips and GPUs would be a heavy blow to China’s chip designers and would affect its competitive edge Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the world’s biggest contract chipmaker, is reportedly to halt supply of artificial intelligence (AI) chips and graphics processing units (GPUs) made on 7-nanometer or more advanced process technologies from next week in order to comply with US Department of Commerce rules. TSMC has sent e-mails to its Chinese AI customers, informing them about the suspension starting on Monday, Chinese online news outlet Ijiwei.com (愛集微) reported yesterday. The US Department of Commerce has not formally unveiled further semiconductor measures against China yet. “TSMC does not comment on market rumors. TSMC is a law-abiding company and we are
FLEXIBLE: Taiwan can develop its own ground station equipment, and has highly competitive manufacturers and suppliers with diversified production, the MOEA said The Ministry of Economic Affairs (MOEA) yesterday disputed reports that suppliers to US-based Space Exploration Technologies Corp (SpaceX) had been asked to move production out of Taiwan. Reuters had reported on Tuesday last week that Elon Musk-owned SpaceX had asked their manufacturers to produce outside of Taiwan given geopolitical risks and that at least one Taiwanese supplier had been pushed to relocate production to Vietnam. SpaceX’s requests place a renewed focus on the contentious relationship Musk has had with Taiwan, especially after he said last year that Taiwan is an “integral part” of China, sparking sharp criticism from Taiwanese authorities. The ministry said
US President Joe Biden’s administration is racing to complete CHIPS and Science Act agreements with companies such as Intel Corp and Samsung Electronics Co, aiming to shore up one of its signature initiatives before US president-elect Donald Trump enters the White House. The US Department of Commerce has allocated more than 90 percent of the US$39 billion in grants under the act, a landmark law enacted in 2022 designed to rebuild the domestic chip industry. However, the agency has only announced one binding agreement so far. The next two months would prove critical for more than 20 companies still in the process
RSS