Japanese shipping giant, Mitsui O.S.K. Lines (MOL), plans to continue its energy transport business from Russia indefinitely, particularly of Liquefied Natural Gas (LNG).
In a New Year’s address, Mitsui O.S.K. President and CEO, Takeshi Hashimoto, said: “Disruptions in supply chains, soaring energy and grain prices, global inflation, and so on, turmoil continues in a variety of fields. Some companies decided to withdraw from Russia-related business, but our group will continue to offer stable transport services.
“We will continue our energy transport business, mainly LNG, from Russia, as long as we can, and this is also in line with the direction of the Japanese government’s policy,” Hashimoto continued.
Data from the US Government indicates that Japan was globally the largest importer of LNG with 4.3 billion metric tons imported as of August 2022, with approximately 10 per cent of its LNG from Russian suppliers.
Due to the surge in market rates and strong demand for ocean-going shipping, MOL anticipates record-high profits for the current fiscal year.
Freight rates have started to decline, especially in the container business, and MOL expects a reversal in market conditions moving forward.
“This year, we may see the impact of inflationary measures in the US and Europe, and a significant but temporary downturn in the economy, however, we expect a return to a moderate expansionary trend in the not-too-distant future, as the Chinese economy normalises and the pace of U.S. interest rate hikes slows,” Hashimoto noted.
“We intend for this year to be one in which we effectively use the capital we have accumulated over the past two years to prepare for deteriorating financial results and to invest for our future growth.”
This estimation comes in conjunction with MOL’s restructuring of business.
Such plans include an expansion of its overseas regional business. The group will be broadly re-grouped into “corporate organisations”, “business organisations”, and “regional organisations”.