China Shipping Container Lines, Asia’s second-largest container line, said it will beat its profit forecast after raising rates for shipments from Europe and carrying more cargo from the U.S.

Chairman Li Shaode said in Shanghai that profit this year will be ’significantly better’ than the RMB3.18 billion ($430 million) previously expected.

He said, ‘Fewer empty boxes help cut costs on U.S. routes.’

Shipping lines are carrying more out of U.S. ports this year as a 10.3% decline in the dollar against a basket of major world currencies cuts overseas prices for exporters. China Shipping raised rates for shipments from Europe to Asia by $500 a box on October 1.

Jack Xu, an analyst at SinoPac Securities in Shanghai, said, ‘We are definitely seeing some accelerating growth in U.S. exports, which will help out with the returning boxes.The outlook for Asia-U.S. trade next year is not encouraging. This because the appreciation of the RMB may damped China’s export growth.

China Shipping’s vessels are now about 40% full on voyages from the U.S., compared with about 10% in the whole of 2006i. Almost all vessels are completely full on sailings to the U.S..
Source: Bloomberg

The first 8,530-TEU container ship — a totally designed and created Chinese ship — has been delivered to China Shipping Container Lines and has left for its maiden voyage to the United States.

It has made China the fourth country in the world, after the Republic of Korea, Japan and Denmark that is able to design and build such giant container ships.

The ship, named New Asia, is one of a group of five container ships of the same type designed and being built by Hudong-Zhonghua Shipbuilding for China Shipping Container Lines.

The 101,000-dwt container ship, 335 meters long and 42.8 meters wide, can reach 25 knots and is the start of a fleet.

The Shanghai-based shipbuilding company spent six years build this first ship, the largest container ship independently designed and built by China. Now the company has confirmed nine orders for its 8,530-TEU container ships, including four for the Greek Costamare Shipping Company.

Our illustration is NOT of this boat but of a similar container vessel. It was built by Samsung Heavy Industries for China Shipping Container Lines and is a 9,600-TEU series mega carrier. Note that this is in the megacarrier class yet only carries about 1,000 more containers than New Asia. And this particular ship is reported as having ‘topped a speed of 25.4 knots, very impressive for a ship of this magnitude to reach.’ So New Asia is both fast and large and destined for success.
Source: China View

China Shipping Container Lines will spend $1.36 billion adding eight 13,296 TEU vessels to its fleet by 2012. The Hong Kong-listed line ended the first half of the year in a strong financial position. It reported a jump in first half net profit to $152 million through the robust China trade and the addition of more than 28,000 TEU capacity.

Intra-Asia trade grew 45% over the same period last year, with CSCL handling 627,868 TEU in the first half.
The domestic China market grew 36.7% with 1.1 million boxes.
Three 9,600 TEU vessels were delivered in the first six months, increasing the group’s container capacity to 427,107 TEU.

Li Shaode, CSCL chairman, told investors that China’s throughput had reached 52.53 million TEU, a growth of 24% in the first half.

He said global shipping capacity was set to grow by 15% this year but would be balanced by the offsetting influence of trade imbalances, longer trade routes tying up vessels and emerging markets absorbing excess capacity.
Source: CargoNews Asia

Cao Desheng, deputy director of the Ministry of Communications’ Water Transport Department, has said the government will encourage foreigners to invest in China’s shipping industry to help expand its fleet. This is part of the plan to make China’s ocean-going fleet the third largest in the world by 2010 and, at the same time, improve maritime security and better protect national interest.

The plan is to more than double the total deadweight tonnage of Chinese-flag flying ocean vessels by 2010. That is up from 44 million dwt to 100 million dwt by 2010 which appears a major leap but there is a fairly simple way around this.

One way to get there is the ministry will encourage banks, logistics enterprises, cargo owners and foreign investors to invest in its shipping industry.

Cao Desheng said, ‘They can set up new companies along with domestic shipping enterprises, with the latter holding at least 25% of the total shares of a new company to overcome worries over shipping security.’

Foreign investors have to necessarily register their companies in China first, and the ships should fly the Chinese flag. This is for security reasons.

The second way of doing it it to bring home the foreign flag registrations. High tariff and value-added tax on imports, or 27.53% cost of shipbuilding, has caused many Chinese ship-owners to register their vessels in other countries. According to official figures, the number of Chinese vessels registered abroad has been increasing, and they account for half of the country’s total international tonnage.

Get them all back under the Chinese flag and the target is nearly met. Thus the Ministry of Communications is dangling a carrot — tax exemption to Chinese-owned ships that were registered abroad before 2006. This incentive is expected to make them register at home — in Shanghai, Tianjin or Dalian — within the next two years. The ministry is also discussing some other long-term policies to encourage Chinese-owned ships to register at home. If all that were to happen the target would be easily met.
Source: China Daily

China’s second largest shipping conglomerate, Shanghai-based, China Shipping Group, plans to build ships by the end of next year.

t the moment its six current yards, situated in Shanghai and Guangzhou, are limited to ship repairs, ship conversions and hull maintenance.

Now ground for a new shipyard has already been broken in the Yanjiang Development Zone of Jiangdu in east China’s Zhejiang Province. It will cover an area of 187 hectares and stretch 3,500 meters along the coastline. The illustration shows a naval ship built by Jiangnan Shipyard, one of China’s major shipbuilders. China is the world’s third biggest shipbuilder in terms of output.

China Shipping Group plans over a period of three years to expand the plant so that it can have an annual production capacity of 1.5 million deadweight tons.

This is the second time in less than two months that a major centrally-administered state-owned enterprise has branched out into shipbuilding.

In March, the Shanghai Baosteel, China’s largest steel producer, jointly invested RMB10 billion ($1.3 billion) with China State Shipbuilding Corporation to build the country’s largest shipbuilding base at the estuary of the Yangtze River.
Source: Marine Log

According to the China Logistics Information Center demand in the logistics sector will rise 15% year on year in China in 2007.

The sector turned over RMB59.7 trillion ($7.65 trillion) in 2006, up 17.1% over the previous year in comparable prices, mainly because of fast growth in shipping of industrial products and imported goods.

Industrial products contributed RMB52 trillion, up 16.4%, while imported goods added RMB6.5 trillion, up 25.2%.

Expenditures on shipping were estimated at RMB4 trillion ast year, up 13.2%. The costs are expected to grow at least 11% in 2007 due to rising oil prices and increasing labor costs.
Source: China View

According to Korean Donga.com, the Chinese shipping industry recently overtook the Korean industry in bulk freight and container freight.

France-based shipping intelligence firm, AXS-Alphaliner, said yesterday, that China Shipping and Cosco ranked 6th and 7th in the world in terms of cargo capacity. They recorded 406,000 TEUs and 390,000 TEUs respectively. China Shipping registered an annual growth of 24.5% and Cosco grew by 10% annually between 2000 and 2006.

Korean shipping companies, in contrast, experienced a drop in profits last year. Hanjin Shipping, for example, posted profits of KRW149.1 billion, a quarter of the profits it recorded in the previous year. 
Source: Donga.com