The extraordinary profits of large container carriers

The world’s largest shipping company, Danish Maersk, is making more money than ever before.

Thanks to the increase in the rental price of its containers, the company recorded the most profitable quarter in its 117-year history.

Profit before taxes and interest reached US$5.9 billion (R$32.4 billion), while revenue reached US$16.6 billion (R$91.3 billion).

The big shipping companies turned out to be the big winners in the supply chain crisis transporting goods across the world.

As there is an excess of demand from consumers and a lack of supply to move products, shipping prices soared.

On some of the busiest shipping lanes between Asia and the United States, Europe, or Latin America, fares have increased by more than 500%.

“The ports are not working as well as they should, so we cannot unload containers as quickly as we would like,” said Soren Skou, chief executive of Maersk, in early November.

Because ports and the entire logistical transport chain are backed up, goods take a long time to reach their destination.

Companies are forced to pay more to transport their products and consumers also end up paying more for them.

Sea giants

Simon Heaney, senior director of the container research unit at Drewry consulting firm, explains that the shipping industry is posting record profits.

Between 2000 and 2019, the sector earned US$ 83.5 billion (R$ 459 billion) from BAIT (earnings before interest and taxes).

This year alone, the projection is that the shipbuilding industry will record a profit of at least US$ 150 billion (R$ 825 billion).

“They’re going to double in one year the accumulated profit of nearly two decades,” Heaney tells BBC News Mundo, the BBC’s Spanish-language news service.

But he warns that this is an exceptional situation.

In general, shipping is seen as “a low-margin industry that attracts few investors,” he notes.

The five largest shipping companies in the world account for two-thirds of the market.

And the top ten companies control 85% of global shipping, according to data from Drewry.

“I would say that the market is moderately concentrated and it is a very competitive sector”, says the specialist.

Source: BBC

To read the full original article, access the link: https://www.bbc.com/portuguese/internacional-59304415

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