China International Marine Containers, the world’s largest container manufacturer, has stated that the shortage of containers has resulted in a slew of orders, keeping its factories busy until the end of the first quarter of 2021.
While the Covid-19 pandemic curtailed factory output early in the year, demand for textile and electronics exports from China is gradually recovering.
However, there is an acute shortage of containers in Asia, as empty containers have been slow to return to the ports of origin from North America. This was due to Transpacific rates hitting a 10-year high in September and lower backhaul volumes.
CIMC, a COSCO unit, stated on Shenzhen Stock Exchange’s interactive platform that the recovery in container shipping and demand has had a positive impact on its business. In order to rush out the container orders, workers in CIMC’s Shenzhen factory have been working double shifts.
At least 95% of containers are manufactured in China. Besides CIMC, other leading Chinese container makers are COSCO Shipping Development and the privately owned CXIC Group Containers. CIMC’s market share is estimated at 45%.
CIMC stated that so far, in the fourth quarter of 2020, container prices have surged, and its profit margin in Q3 2020 was back to pre-Covid-19 levels. The company booked a net profit of CNY880.36 million (US$129.08 million) during the quarter, rebounding from a CNY43.5 million (US$6.11 million) net loss in Q3 2019.Revenue totalled CNY24.16 billion (US$3.54 billion) in the third quarter, up from CNY18.94 billion (US$2.66 billion) in 2019, with CIMC’s net profit margin reaching 3.64%.
Martina Li
Asia Correspondent
