Carriers earnings in 2021 equal to ten years’ returns.
The old adage of seven lean years following seven fat years has long lost its relevance. Sales and profits generated by the major shipping lines bubbled over in 2021 – ending above the total for the entire preceding ten years.
The major carriers’ financial results are brimming over – which has come as no surprise anymore for the past 18 months. Now the Copenhagen-based maritime consultancy Sea-Intelligence has presented an analysis of the development of the major shipping lines’ finances and volumes in the third quarter of 2021, and then compared the figures to the first half of 2021 as well as to annual results since 2010.
Freight rates driving up profits – volumes declining
The record levels reached by the freight rates led to every shipping line with global operations marking a significant upsurge in sales. The range saw sales grow by 83.9% year-on-year for Maersk, through to +274.1% for Wan Hai. Even Q3/2020, which was stronger again, couldn’t keep up with that.
Ebit came in even stronger, as the carriers made profits of USD 37.24 billion in Q3/2021 alone. If you add profits of USD 42.1 billion from H1/2021 to that, then the major shipping lines have already made total profits this year of almost USD 80 billion. These figures don’t even include MSC, as the second-largest carrier worldwide is a private enterprise that doesn’t publish any results.
In a synopsis Sea-Intelligence CEO Alan Murphy sought to “put this in perspective. Total profits for all of the years from 2010 to 2020 came to approximately USD 37.9 billion. To put it succinctly, the maritime industry has, in the first three quarters of 2021, doubled its profits in comparison with the entire preceding ten-year period.” So these returns aren’t extraordinarily high – they are historically unique.
High freight rates balanced out declining volumes
These excellent results weren’t even dampened by the fact that many carriers registered declining overall transport volumes, with the quantities carried on trans-Pacific as well as on Asia–Europe routes both falling significantly. The freight rate levels compensated every effect.