American Shipper



   For the world's leading container lines, the transpacific trade in 1999 accounted for 59 percent of carrier income on the three main east/west trades, according to a study by Drewry Shipping Consultants Ltd.

   “This trade, which is set to generate close to 11 million TEUs of east/westbound traffic in 2000, has assumed an absolutely central role in the global industry accounts,” Drewry reports in its Container Market Quarterly.

   The transpacific accounted for an estimated $14.8 billion in ocean freight and ancillary charges for carriers in 1999, up 28.7 percent over 1998, Drewry said. That accounts for 58.5 percent of the $25.3 billion in aggregate earnings from east/west trades by the container lines.

   Eastbound transpacific accounted for $11.7 billion, or 46.3 percent to carriers' earnings in 1999. The earnings increased 39.3 percent over the year-earlier estimates, due to a 13-percent increase in volumes and improved average rates. Transpacific westbound was flat at $3.1 billion, or 12.2 percent of carriers' total earnings, meaning the transpacific was the most imbalanced of the east/west trades, Drewry said.

   The transpacific shift “would go a long way to explaining why a carrier such as Hanjin, which typically ranks in the top three transpacific lines, recorded an 11-percent rise in average revenue per TEU in 1999, while P&O Nedlloyd, which commands a much more modest share of that trade, experienced a fall of 5 percent, and transatlantic oriented CP Ships a fall of over 10 percent,” Drewry said.

   The transatlantic earnings actually fell, to $3.8 billion, from $4.3 billion in 1998. Consequently, the transatlantic's share of total earnings fell to 15.1 percent, from 20.3 percent. The largest fall came in the eastbound transatlantic, where earnings fell to $1.8 billion from $2.2 billion, while westbound declined $100 million to $2.0 billion. Still the trade was fairly balanced with westbound accounting for only 53 percent of total revenue, Drewry said.

Asia/Europe trade improved to $6.7 billion, from $5.5 billion, accounting for 26.3 percent of carriers earnings. Westbound traffic accounted for 19.4 percent, or $4.9 billion, while eastbound accounted for 6.9 percent, or $1.7 billion.