Earnings before interest and tax (EBIT) for container lines
in Q2 far exceeded expectations and major-listed companies have upped earnings
forecasts for the rest of the year.
In the second quarter Drewry estimates that EBIT topped
$39.2bn an 11-fold improvement on the same period in the previous year. It
noted that higher bunker and charter costs had had little impact with every
carrier it tracked increasing margins compared to Q1, some by more than 50%.
Having forecast back in July that container lines combined
profits could hit $100bn for 2021 as whole Drewry has now increased this EBIT
forecast to what it describes as an “eye-watering” $150bn. Significantly
looking at 2022 it says EBIT for lines “could be slightly more again”.
“To seasoned observers of the container market, typing these
numbers on a page is frankly surreal,” the analyst commented in a Container
Container vessel supply lags behind demand until 2023 with
port handling expected to increase 8.2% this year and 5.2% in 2022.
Looking at freight rates Drewry said:”Stronger than expected
spot rate movement in 3Q21 and a longer supply chain recovery timeline are
behind our reason to upgrade the outlook for average global freight rates (spot
and contract) for 2021 to 126%, which is an upward adjustment from 47% in our
“For 2022, spot rates are expected to decline, but there
will be a significant increase in contract pricing, leading to an increase in
average global pricing of about 6%.”