The party is not quite over for the major container ship owners, but the clouds are gathering on the horizon. After two years marked by a historic surge, freight rates have been collapsing since the spring. The decline is expected to continue in the coming months due to the sharp slowdown in the global economy and trade, and the bubble in profits from the Italian-Swiss MSC (unpublished), the Danish Maersk, the French CMA CGM, the Chinese Cosco or the German Hapag-Lloyd will deflate with the normalization of the maritime transport market.
It is in this context that the CEO of CMA CGM, Rodolphe Saadé, presented, on Friday 25 November, his financial results for the third quarter, which remain at very high levels: the net profit of the world number three in container transport reached 7 billion dollars (6.75 billion euros), close to that of Maersk (8.9 billion), for a turnover of 19.9 billion dollars. Profits that add to the 14.8 billion in the first half and the 17.9 billion made in 2021.
Mr. Saadé shows his willingness to continue his investments to ” to reinforce [ses] positions » and “accelerate [la] energetic transition [de son groupe] »in particular with the order for ships propelled by liquefied natural gas, or even methanol. “But we are currently observing a drop in demand, which is leading to a normalization of international trade, and a significant drop in freight rates”nuance the boss of CMA CGM in a press release.
The composite index of freight rates, calculated by the British firm Drewry, is actually falling from week to week. While still higher than in 2019 – $1,420 per 40-foot (12-meter) container – it has fallen from its peak of $10,377 in September 2021 to $2,591 today. Between Shanghai and Le Havre, it went from 15,000 dollars to 3,000 dollars. Fuel oil refueling has increased by 60% at the same time. This turnaround, CMA CGM had anticipated at the end of 2021. “Visibility is not huge in our businessthen indicated one of the bosses of the lines of the group. Our fixed costs are high, while our revenues can fluctuate rapidly. »
Acquisition Frenzy
The group has earned more in 2020-2022 than between 1978, the year it was founded in Marseille, and 2020. Like the entire sector, which has earned more over this short period than since its birth, end of the 1950s, with the invention of the container. According to Drewry, he earned $7 billion in 2019, $26 billion in 2020, and $210 billion in 2021; he expects 270 billion in 2022. “It’s a once-in-a-lifetime situation”confided the boss of the German shipowner Hapag-Lloyd, Rolf Habben Jansen, to the FinancialTimesearly September.
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