Six of the world’s top 10 shipping companies posted negative growth in the fourth quarter of 2023 due to a sluggish global shipping market. Among them, only two posted a profit thanks to the acquisition of mega-ships: HMM, a Korean shipping giant that claims eighth place, and Taiwan’s Evergreen.
Among the world’s top 10 carriers, Denmark’s Maersk (No. 2), France’s CMA-CGM (No. 3), Germany’s Hapag-Lloyd (No. 5), Japan’s ONE (No. 6), Taiwan’s Yang Ming (No. 9) and Israel’s Zim Integrated Shipping Services (No. 10) posted operating losses in the fourth quarter of last year, according to sources in the shipping industry on March 24. Excluding Switzerland’s MSC (No. 1), which does not disclose its business results, and China’s COSCO (No. 4), which has yet to announce results, six of the eight largest shipping companies posted negative growth.
Maersk logged US$92 million (13 percent of its sales) in losses in the fourth quarter of 2023. It had posted losses in the previous quarter so it had the second consecutive quarter of negative growth. Hapag-Lloyd and ONE also lost US$245 million and US$248 million in the fourth quarter last year, respectively.
Shipping market experts believe that the end of the COVID-19 pandemic and the sharp deterioration of the shipping market due to an economic downturn have lowered shipping companies’ earnings. The Shanghai Container Freight Index (SCFI), a measure of actual freight rates on ocean shipping lanes, fell by about 25 percent year on year to around 1,000 points in the fourth quarter of 2023.
However, HMM, Korea’s largest container carrier and the eighth-largest global carrier, managed to break even along with Taiwan’s Evergreen, the seventh-largest. Since turning profitable in the second quarter of 2020, HMM has been in the black for 15 consecutive quarters through the fourth quarter of 2023. In 2023, HMM’s operating profit per TEU was US$119, more than Maersk’s US$94, according to Danish shipping research firm Sea Intelligence. One TEU is one standard 20-foot shipping container.
Since April 2020, HMM has introduced 20 ultra-large ships including 12 24,000-TEU ships and eight 16,000-TEU ships. The percentage of 15,000 TEU and larger ships in all of HMM’s ships is 53 percent, the highest in the world. It exceeds the average of 23 percent among the top 20 carriers. The ratio is expected to climb further when all 12 of the 13,000-TEU ships ordered in 2022 are delivered to HMM this year.