Taiwanese ocean carrier Yang Ming has suffered another loss in the second quarter of 2018, despite a slight increase in revenue of 1.1%, and a significant boost in TEU volume of 10.3% compared to Q2 2017.
Across the first half of 2018, Yang Ming made a loss of approximately US$195 million, which has been attributed by the company to higher operating costs and fuel price rises.
In addition, Yang Ming claims that the shipping industry still shows an oversupply in tonnage.
These findings are consistent with Alphaliner’s forecast, which recently suggested that supply was 1.3% ahead of current demand.
However, demand is expected to grow 0.5% faster than supply in 2019.
Matthew Gore provides a container market review for 2017 in a recent Port Technology technical paper
This presents a more optimistic economic outlook from which the shipping industry stands to benefit, according to Yang Ming.
In order to mitigate further losses, Yang Ming has continued its efforts to lower costs and increase revenue.
Measures taken by the carrier include its capitalisation on slow steaming, which reduces both bunker consumption and harmful emissions.
Second half performance is also expected to improve due to stronger peak season demand and less new tonnage being introduced to the market.
As a result of these circumstances, it is predicted that ocean freight rates may rise.
Nazery Khalid discusses the importance of green shipping in a recent Port Technology technical paper
Yang Ming are considering its future as well, having approved the construction of ten 2,800 TEU containerships, equipped with advanced eco-friendly equipment which will comply with environmental regulations.
The number of Yang Ming’s 10,000-plus TEU class vessels will also increase to 30.
The company hopes that updates to its fleet will help to provide efficiency, energy savings, and lowered unit costs.