Yang Ming Marine Transport plans to build more ships and containers this year, as it remains optimistic about the freight environment.
At a press conference on 30 March after the release of the Taiwanese liner operator’s 2021 financials, the company’s director Chang Shao-feng said that more 15,000 TEU ships will be ordered to meet demand on the Asia-Europe and Transpacific lanes, which are Yang Ming’s main revenue generators.
In 2021, Yang Ming enjoyed record earnings as the liner industry saw a second straight year of all-time high profits.
Chang commented, “This year will still be favourable to shipping companies as capacity remains tight. However, as new ships are delivered one after another in 2023, the supply may exceed demand, but it still depends on the Covid-19 situation, whether there is an improvement in port congestion.”
Yang Ming is also considering ordering some feeder ships with individual capacities of 1,200 to 1,800 TEU. Additionally, the company will take delivery of 40,000 new containers by the end of this month, and plans to order another 30,000 in the second half of 2022.
Chang admitted that the uncertainties arising from the Russia-Ukraine war had placed downward pressure on freight rates, and while 20% of Yang Ming’s Asia-Europe shipments and half of the company’s Transpacific volumes are tied to long-term contracts, contractual rates have been reduced in recent negotiations.
He added that Shanghai’s lockdown, which began on 28 March, has disrupted supply chains, causing Yang Ming to divert some ships to other ports that are also facing high demand.
Chang said, “We believe that this year, freight rates won’t increase as much as last year, but if the capacity shortage continues, there’s a good chance that freight rates will stay high.”