EVERGREEN WARNS OF CONTAINER RATE PRESSURES

EVERGREEN WARNS OF CONTAINER RATE PRESSURES    Evergreen Marine Corp., the listed arm of Taiwan’s Evergreen group, has warned of pressures on container freight rates and the impact of the slowdown in trade.
   “With regard to freight rates, as more new vessels of over 6,000-TEU have been introduced onto the Far East/U.S. and Far East/Europe/Mediterranean routes, rate stability is under pressure,” said Lin Sun-san, chairman of Evergreen Marine, in a letter to shareholders.
   “It is not going to be easy to achieve further rate adjustments,” Lin said. “To deal with this, the company has taken practical measures aiming to improve its profitability and control its operating cost.”
   Evergreen cited forecasts by the IMF of growth of slightly more than 3 percent in the global economy this year. “Since some uncertainties still exist worldwide, we intend to take a cautious and conservative approach to the shipping market this year,” Lin said. Lin said the company’s business strategy this year includes “soliciting more direct cargoes,” forging alliances with other carriers to fully utilize vessel space and further developing activities in the mainland Chinese market.
   On the transpacific trade, Evergreen said it expects some cargo growth in mainland China, Thailand and Malaysia.
   On the Asia/Europe trade, Evergreen said slot capacity would increase 13 percent this year, whereas demand would rise 7 percent. “In a situation where the supply of slots exceeds demand, keen competition is foreseeable in 2001,” Evergreen said.
   In a recent statement, Evergreen Marine Corp. predicted its revenues will fall by 11 percent this year, to NT$18 billion ($515 million), from NT$20 billion in 2000. However, the company expects lower operating expenses and a higher net income this year.