DHL Global Forwarding, Freight OCEAN FREIGHT MARKET …...The ocean carriers have yet to announce the baseline for their revised BAF calculations and the effective date. Source: Alphaliner,

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OCEAN FREIGHT MARKET UPDATE

DHL Global Forwarding, Freight

September 2019

Publication Date 29th August 2019

Dominique von Orelli – Global Head, Ocean Freight

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Contents

TOPICS OF THE MONTH The VLSFO (Very low Sulphur Fuel Oil) premium over HFO (Heavy Fuel Oil)

HIGH LEVEL DEVELOPMENT

MARKET OUTLOOK Freight Rates and Volume Development

ECONOMIC OUTLOOK & DEMAND DEVELOPMENT

CAPACITY DEVELOPMENT

CARRIERS

REGULATIONS

? DID YOU KNOW? Container Fires On Board

PUBLIC

DHL Global Forwarding | OFR Market Update | September 2019

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Bunker price uncertainty remains: The VLSFO price premium over HFO

Initial price information for IMO 2020 compliant 0.5% VLSFO (Very Low Sulphur Fuel Oil) bunker is now available for several main ports. The data provides an early indication of the price premium that carriers will need to pay for cleaner fuel as of next year. Accoding to data compiled by Alphaliner for bunkering at Singapore and Rotterdam, the initial price premium for VLSFO ranged between $100 to $150 per ton in July, compared to IFO380 HFO. This spread then increased to more than $200 per ton in August, since recent price declines for ‘standard bunker’ were not immediately mirrored by falling VLSFO prices. End of August, the price premium standst at $150 per ton in Singapore and $210 per ton in Rotterdam. The ocean carriers have yet to announce the baseline for their revised BAF calculations and the effective date.

Source: Alphaliner, DHL

Topic of the Month The VLSFO (Very low Sulphur Fuel Oil) premium over HFO (Heavy Fuel Oil)

Fuel price difference between IFO380 and 0.5% VLSFO


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High Level Market Development – Supply and Demand

ECONOMIC OUTLOOK GDP GROWTH BY REGION1)

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1) real GDP, Global Insight, Copyright © IHS, Q2 2019 . All rights reserved. 2) Demand growth = Port-to-Port Container Traffic growth. Supply growth = Fleet Growth. Source: Drewry Maritime Research. 3) Drewry, in USD/40ft container, including BAF & THC both ends, 42 individual routes, excluding intra-Asia routes. 4) Shanghai Shipping Exchange, in USD/20ft container & USD/40ft ctnr for US routes, 15 routes from Shanghai. 5) Bunker Index, in USD/metric ton, Bunker Index MGO (BIX MGO) = avg. Global Bunker Price for marine gasoil (MGO) port prices; (BIX 380= avg. Global Bunker Price for all 380 centistoke (cSt) port prices; both index published on the Bunker Index website. 6) DHL Global Trade Barometer Jun19, index value represents weighted average of current growth and upcoming two months of trade, a value at 50 is considered neutral, expanding above 50, and shrinking below 50.

BUNKER PRICE INDEX5) WORLD CONTAINER INDEX (WCI)3) SHANGHAI CONTAINERIZED FREIGHT INDEX (SCFI)4)

DHL TRADE BAROMETER6)

0

500

1,000

1,500

2,000

2,500

3,000

Q4 Q1 ’18

Q2 Q3 Q4 Q1 ’19

Q2 Q3

1,100

400

900

800

500

1,000

600

700

1,200

Q1 ’19

Q4 Q1 ’18

Q2 Q3 Q3 Q2 Q4

600

0

800

200

400

1,000

Q1 ’18

Q2 Q3 Q4 Q1 ’19

Q2 Q3 Q4

30

35

40

45

50

55

60

65

70

75

Q1 ’18

Q3 Q1 ’17

Q3 Q2 Q2 Q4 Q4 Q1 ’19

Q2

Global

Ocean

Actual

Forecast

Actual

Forecast

SUPPLY/DEMAND GROWTH (ANNUALIZED), IN % 2)

Supply Growth %

Demand Growth

%

0%

1%

2%

3%

4%

5%

6%

2018 2019F 2020F 2021F 2022F 2023F

SUPPLY/DEMAND GROWTH (ANNUALIZED), IN % 2)


Jun19 index

predicts Jun-

Aug19 trade

development

BIX 380

BIX MGO

2019F 2020F 2021F 2022F 2023F CAGR

(2020-23)

EURO 1.4% 1.3% 1.5% 1.6% 1.6% 1.6%

MEA 2.1% 2.9% 3.0% 3.2% 3.4% 3.2%

AMER 2.4% 2.1% 1.8% 1.6% 1.6% 1.7%

ASPA 4.5% 4.5% 4.5% 4.6% 4.6% 4.5%

DGF World 2.9% 2.8% 2.8% 2.8% 2.8% 2.8%

Carriers will start bunkering

IMO 2020 compliant fuel as of

Q4 ’19. Implications on

bunker & BAF prices not

known yet.

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Market Outlook September 2019 – Major Trades

Pre-Chinese Golden week rush out of Asia now expected to come in September

KEY Strong

Increase ++

Moderate Increase

+ No

Change =

Moderate Decline

- Strong Decline

- -

EXPORT REGION1 IMPORT REGION CAPACITY RATE

EURO AMNO = =

AMLA = =

ASPA - =/+

MENAT - =/+

SSA =/- =/+

AMNO AMLA = -

ASPA = =

EURO = =

MENAT = =

SSA = =

EXPORT REGION IMPORT REGION CAPACITY RATE

AMLA AMNO = =

ASPA = =

EURO = =

MENAT = =

SSA ++ +

ASPA ASPA = =/+

AMNO = -

AMLA = +

EURO = +

MENAT = +

OCEANIA - +


Source: DGF

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Market Outlook September 2019 – Ocean Freight Rates Major Trades Market outlook on smaller trades available in the back-up

O C E A N F R E I G H T R A T E S O U T L O O K

ASPA – EURO A new round of GRI is around the corner, planned to be implemented for the 1st and/or 15th September as a pre Golden week rush is expected to arrive.

EURO – ASPA & MEA Additional blank sailings (vessel Maintenance Schemes and scrubber upgrades), put pressure on space and container availability in the European hinterland. Long term rate agreements remain stable for Far East, but seeing some increments on the IPBC Trade.

ASPA – AMLA High utilization both to ECSA & WCSA. Some carriers are facing 2 weeks roll pool situation. All carriers requires 2 weeks advance bookings to ensure booking acceptance.

ASPA – AMNO Both USWC & USEC are under rate pressure as overall utilization has dropped to mid 90%. THE alliance has provided Oct blank sailing schedule and winter program planning is being finalize.

EURO – AMNO space remains tight. However situation is expected to ease in the upcoming weeks

ASPA – MENAT MIDDLE EAST: Volatile market into Middle East. Carriers have also implemented WRS into Middle East / Red Sea region with effective July 2019. AFRICA: Carriers have announced GRI starting Mid-Sep. Market is currently flat. Hence, partial mitigation is expected.

ASPA – ASPA

Pre-Chinese Golden week rush from Mid September is expected. Cargoes rolling at transshipment port on the Indian Subcontinent trade have eased a little but may worsen again with the rush. Blank sailing / GRI from carriers for Intra-Asia services towards end of the month (Week 40) will be implemented. Heavy rains and floods in South Asia have further affected port productivity and operations in Chittagong, further delays are to be expected.

AMNO – EURO Capacity is stable although a slight reduction of capacity is expected for week 37 & 38. Rates remain flat till the end of Q3 2019


Source: DGF

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Economic Outlook & Demand Development Heightened danger, increased policy stimulus

Source: IHS Markit, IHS Purchasing Manager Index Manufacturing, a PMI at 50 is considered neutral, expanding above 50, and business shrinking below 50.


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EURO

The rising probability of a “non-deal” Brexit & the prospects of snap elections in IT & the UK have significantly worsened the risk environment for EURO business. Year-on-years GDP growth in the Eurozone edged down from 1.2% to 1.1%, the weakest pace since Q4 ’13. IHS Markit has reassessed the probability of a non-deal Brexit at 35-40%, compared with 20% in April. The heightened uncertainty undoubtedly contributed to the 0.2% QoQ drop in real UK GDP in Q2.

AMNO Large upward revisions to employee income in recent quarters & improved momentum in consumer spending will sustain growth. In addition, the US Congress passed, & the president signed, the Bipartisan Budget Act of 2019, which lifts spending caps & suspends the debt ceiling, resulting in more fiscal stimulus in the next few years & less fiscal uncertainty.

ASPA

Private investment, government spending, & private consumption all posted solid gains in JP. Strength in domestic demand was offset by weakness in foreign trade. Given the safe-haven status of the Japanese yen, a currency war would likely lead to its strengthening, which would damage JP’s growth further. CN’s growth was already slowing before the latest round of trade hostilities. The real GDP growth rate of 6.2% YoY in Q2 ’19 was the weakest since CN began reporting quarterly GDP numbers in 1993. If the US imposes 10% tariff on another USD 300bn of US goods imports from CN, IHS Markit estimates the direct impact would be a reduction in CN’s real GDP growth of ~0.2 Ppt. In 2020 & 21. The 5 Aug currency devaluation was relatively small & meant as a warning shot, as the CN government quickly assured global markets it was not the beginning of «competitive devaluation». Nevertheless, further devaluation could trigger massive capital flight & fiscal instability.

EMERGING MARKETS

The trade dispute between the US & CN has disrupted global supply chains, pushed down commodity prices, & pummeled exports from Emerging Markets. On the positive side, the interest rate cut by the Fed & expected stimulus by the ECB has allowed central banks to ease their monetary policies. CN’s devaluation, if contained, may also be good news, allowing emerging-market currencies to drift down without collapsing.

DEMAND DEVELOPMENT

Manufacturing output fell for a second successive month, indicating the first spell of falling production since 2012. This was, in turn, linked to an 11th successive monthly decline in global goods export orders, which registered their weakest performance since Oct ’12. Territories in decline now include mainland CN, JP, DE, UK, ES, IT, BR, RU, TW, KR, & MX.

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Capacity Development 1/2

C A P A C I T Y

HMM has announced the closure of its stand-alone North Europe-Far East ‘AEX’ service with an average weekly capacity of 4’900 TEU. HMM will continue to offer all port-port combinations offered by the ‘AEX’ service by taking slots as from the end of August 2019 on four of the five North Europe-Asia loops of THE Alliance which the Korean carrier is to join on 1 April 2020 as a full member alongside Hapag-Lloyd, ONE and Yang Ming. The closure of the ‘AEX’ service means that HMM will not be operating any ships on the Asia-North Europe trade until 1 April next year, when it will be fully rehabilitated as a major carrier by introducing twelve 23,000 TEU newbuildings that are under construction and planned for delivery in the 1st half of 2020.

Maersk has launched a fast Far East-North Europe service based on a rail service between Vostochniy and St Petersburg, connecting at both ends with intra-Asia and intra-Europe maritime services of its regional affiliates Sealand Asia and Sealand Europe & Med for the pre- and on-carriage of the containers. The service is branded as ‘AE-19’ and offers significantly faster transit times between certain NE Asia and Baltic ports. As an example transit time offered with the ‘AE-19’ is 18 days, compared to 42 days via the all water route.

COSCO Shipping and OOCL have launched on 5 August a Transpacific ad hoc peak season service connecting South China and Long Beach using classic panamax ships of 4,100-4,950 TEU. The new service is branded as ‘AASP’ by Cosco and as ‘South China 2’ by OOCL. It offers an average weekly capacity of 4,365 TEU slots and turns in five weeks calling at Hong Kong, Yantian, Long Beach, Hong Kong. Eight sailings are currently advertised to run from August to early October. In addition to this peak season service, COSCO and OOCL will also deploy th 6,892 TEU BUXCLIFF on an ad-hoc trip to the US East Coast on 9 September.

Hapag-Lloyd, ANL/APL (CMA CGM Group), Maersk and ONE will consolidate their South East Asia – Australia offerings in October by introducing two weekly services, replacing the existing loops. Overall capacity will increase by about 800 TEU per week, with the introduction of 8,500 TEU ships on one loop replacing 2,700-5,700 TEU ships currently deployed on two separate loops. The two new services are scheduled to be launched on 23 October from Laem Chabang and on 25 October from Tanjung Pelepas respectively.

CMA CGM is to offer for the third consecutive year a seasonal (fuitoriented) North Brazil-North Europe service connecting Vila do Conde and Fortaleza with London-Gateway and Rotterdam. This service, dubbed ‘UK Express’, will kick off on 15 September from Vila do Conde. It will cater primarily for the North Brazil fruit exports and is expected to be operated until early next year.


Source: Alphaliner, Dynaliners, carriers

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Capacity Development 2/2

C A P A C I T Y

The inactive containership fleet has dropped slightly to 145 units for 552,920 TEU as at 19 August, or 2.4% of the total fleet, compared to 564,112 TEU two weeks earlier. Ships undergoing scrubber retrofits continued to drive the inactive fleet numbers, with some 27 units for 282,850 TEU identified to be out for this reason including the majority of the inactive fleet of over 7,500 TEU. The large number of inactive ships at retrofit yards have sparked demand for replacement tonnage in the last two months which has driven up charter rates for the larger sizes, but his has not filtered down to the smaller size segments where there remains a sizeable number of idle ships of below 3,000 TEU that are without employment.



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C A R R I E R S

ONE reported a $5 M net profit in the 2nd Q 2019 (fiscal 1st Q of the Japanese financial year), its first profitable quarterly results since the company started operations in April 2018. The improved performance turned around a -$120 M net loss in the same quarter last year, with the bulk of the improvement coming from a $220 M gain due to improved liftings while only $20 M was due to higher freight rates. According to Alphaliner’s analysis of ONE’s reported liftings, the carrier has regained all of the volumes lost on the Asia-Europe routes but continues to see reduced volumes on the transpacific routes where the headhaul eastbound liftings are still 8% lower than the 2nd Q of 2017, while the backhaul westbound liftings are 14% lower.

Hapag Lloyd’s 2nd Q 2019 results show declining momentum in its earnings recovery, with operating profit and net profit sliding below the 1st Q numbers. The carrier reported a net profit of $46 M in the 2nd Q 2019 compared to $92 in the 1st Q. Although overall 1st half year performance were significantly improved compared to the same period last year, the positive trend has reversed due to lower freight rates and higher bunker prices.

Maersk reported net earnings of $154 M in the 2nd Q 2019, a significant improvement on both year-on-year and quarter-to-quarter performance. The result is the first positive performance for the Group after five previous negative quarters following its reorganisation in 2017 with the disposal of its energy business units. The positive results were driven by improvements in its Ocean business which account for 66% of the group’s revenue in the latest quarter. Total liftings increased by 1.4% while average freight rates were 1.5% higher compared to last year.

HMM has continued its loss making streak with an operating loss of –KRW 101 bn ($87 M) in the 2nd Q 2019 for its container shipping business, marking the 17th consecutive negative quarter for the Korean Carrier. Total liftings increased by 0.4% and average revenue increased by 5.2%.

The three main Taiwanese carriers Evergreen Marine Corp. (EMC), Yang Ming and Wan Hai reported lower quarterly earnings in the 2nd Q 2019 compared to their 1st Q earnings, although they still improved their results compared to the same quarter of 2018. Reported net profit for the 2nd Q: EMC –TWD 355 M vs TWD 560 Q1, Yang Ming –TWD 1’265 M vs –TWD 682 M Q1 and Wan Hai TWD 698 M vs TWD 1’042 M Q1. Although all three carriers reported higher revenues in the 2nd Q, operating margins have deteriorated with both EBIT margins and EBITDA margins declining on a quarter-on-quarter basis.

OOCL has logged a net profit of $64 M in the 1st half of 2019 for its container shipping operations. The results were an improvement over the -$77 M net loss that it recorded in the same period last year. OOCL’s parent company OOIL posted a total net profit of $139 M, including earnings from its property investments and LBCT.

Carriers 1/2

Source: Alphaliner, carriers


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C A R R I E R S

ZIM has reported a net profit of $4 M in the 2nd Q 2019, reversing a net loss of -$35 M in the same quarter last year. The result was also an improvement over the -$25 M in the 1st Q 2019, and is ZIM’s first positive quarter following six consecutive quarters of negative net earnings. Total liftings declined by 5% compared to the same quarter of 2018, due mainly to rationalisation of ZIM’s capacity on the Asia-US East Coast route following the start of its strategic cooperation with the 2M on that route since September 2018. ZIM’s shareholder equity remained in deficit despite the positive 2nd Q results, standing at -$256 M as at the end of June 2019. Since 2018, ZIM has recorded cumulative net losses of $2.59 Bn. ZIM currently has the highest exposure to the charter market, with 94% of its current fleet coming from chartered ships.

Carriers 2/2

Source: Alphaliner, carriers


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The fire on the container vessel APL LE HAVRE that was reported on board in the afternoon of 9 Aug 2019 off Gujarat coast, India, Arabian sea while en route from Karachi to Nhava Sheva was the 6th such incident this year. DynaLiners has compiled a list of all fires on board container vessels that have started inside the boxes they were carrying. The list clearly shows that such incidents are happening more and more. No wonder carriers are starting to levy extensive fines for misdeclaration of hazardous cargo. In the latest list of lines, Hapag Lloyd announced that it would implement a penalty of USD 15,000.00 per container, effective from September 15, 2019 for misdeclaration of dangerous goods..

Source: DynaLiners, carriers

Did you know? Container Fires On Board


Vessel TEU Year

APL Le Havre 11’100 2019

Shahr E Kord 2’200 2019

APL Vancouver 9’200 2019

ER Kobe 6’000 2019

Yantian Express 7’500 2019

Grande America 1’300 2019

Cosco Shipping Thames 9’100 2018

Maersk Honam 15’300 2018

SSL Kolkata 1’100 2018

Maersk Kensington 6’500 2018

APL Austria 6’300 2017

MSC Daniela 13’800 2017

Maersk Londrina 8’700 2017

Ludwigshafen Express 13’200 2016

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B A C K - U P

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Source: DGF

Market Outlook August 2019 – Ocean Freight Rates Additional Trades (1/2)


EURO – AMLA Minor rate adjustments. Capacity remains stable

EURO – MENAT ME region shows same trend as ASPA; Additional blank sailings, combined with strong commodity demand put pressure on space and container availability. Space situation continues to be tight.

EURO – SSA Rates could increase as of Q4 due to ongoing congestion due to severe port situation in South Africa. Carriers are still sitting on backlogs of cargo. First carrier is implementing an OES = Operational Emergency Surcharge. All South African ports are suffering with operational issues due to weather conditions, failure of cranes/equipment and structural issues.

AMNO – MENAT Rates in the market are stable. Except slight decrease to India Subcontinent. Space continues to be tight out of USEC & USGC Ports on

services to M. East & India Subcontinent, but the situation improved slightly compared to July-August. September bookings are 1-2 weeks out from USEC and 2 weeks out from Houston. No issues out of USWC

AMNO – SSA Rates to South Africa and West Africa remained unchanged since the beginning of 2nd Q. No changes in capacity. Space is available

AMNO – AMLA Market is soft to WCSA and ECSA from US. Economic and political challenges in AR and BR slowing growth outlook. Carrier services are reset and space open.

AMLA Exports

Equipment imbalance affecting drop off conditions in CO & CL. 13% VAT to be implemented on all haulage within Costa Rica. Space constraints w/weekly rolls at Callao Port. Carriers introducing service to Posorja EC(deep water port). Congestion continues at all t/shipment ports in Central America

AMNO – ASPA Generally stable rates. GRI for USWC ports to Oceania, and little space for direct carriers through week 35 due to the stink bug fumigation push.


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Market Outlook August 2019 – Ocean Freight Rates Additional Trades (2/2)


EURO MED - AMNO Rates will remain stable

EURO MED – AMLA Unchanged / stable

EURO MED – ASPA Slight increase ex Adriatic depending on the service.

EURO MED – MENAT Unchanged / stable

EURO MED – SSA Unchanged / stable

ASPA-SPAC Due to consistent capacity reduction, carriers continue to implement rate increases in an attempt to keep rates higher


Source: DGF

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Market Outlook – Volume Outlook in Main Trade Lanes, 2019 Estimate & 2020/23 Growth Forecast in %

N O R T H

A M E R I C A I n c l .

M E X I C O

4.3 mTEU +2.2%

2.3 mTEU +1.5%

1.7 mTEU +3.4%

0.4 mTEU +4.4%

N O R T H

A M E R I C A I n c l .

M E X I C O

L A T I N

A M E R I C A

E U R O P E

I n c l . M E D

14.6 mTEU +3.8%

7.3 mTEU +2.2%

7.6 mTEU +3.0%

18.5 mTEU +3.4%

1.7 mTEU +4.0%

4.4 mTEU +4.8%

2019e, in mTEU 2020e-2023e CAGR, in %

F A R E A S T

I N T R A A S I A

excl. Oceania

40.7 mTEU +3.8%

2.0 mTEU

+3.9%

1.5 mTEU

+3.0%

L A T I N

A M E R I C A

G L O B A L C O N T A I N E R T R A D E 2 0 1 9 e 1 5 1 . 2 m T E U + 3 . 9 % C A G R 2 0 2 0 e - 2 0 2 3 e

Mid-term growth is mainly driven by Asian tradelanes.

Source: Seabury Jun19 update


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Carrier Mergers, Acquisitions and Alliances

M E R G E R S A N D A Q U I S I T I O N S

China

Shipping Cosco OOCL Evergreen APL

CMA

CGM Hapag

Lloyd

United

Arab

Shipping

Hyundai

Merchant

Marine

Hamburg

Süd Maersk

Line MSC K Line MOL NYK

Yang

Ming

CHINA COSCO SHIPPING

OOCL EVER

GREEN CMA CGM

APL HAPAG-LLOYD

HYUNDAI

MERCHANT

MARINE

MAERSK LINE

Hamburg Süd MSC

OCEAN NETWORK

EXPRESS (ONE) YANG

MING

A L L I A N C E S

F O R M E R A L L I A N C E S P R E S E N T A L L I A N C E S

2M MAERSK LINE

MSC OCEAN 3

CMA CGM

CHINA SHIPPING

UNITED ARAB

SHIPPING COMPANY

2M MAERSK LINE

MSC

OCEAN

ALLIANCE

OOCL

CMA CGM

CHINA COSCO SHIPPING

EVERGREEN

G6

HAPAG-LLOYD

MOL

NYK

APL

HYUNDAI

MERCHANT

MARINE

OOCL

CKYHE

COSCO

EVERGREEN

HANJIN

SHPPING

K-LINE

YANG MING THE ALLIANCE

HAPAG-LLOYD

ONE

YANG MING

HMM (from 1 April

2020) *Source: Carriers

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Carrier Financial Results 2018, as at 24 May 2019


Source: Alphaliner, DynaLiners; n.a. = not available, n.m. = not meaningful, 1) local currency numbers were converted into US$ using the average exchange rate for relevant financial period, 2) CMA CGM include NOL/APL, 3) results are full Japanese

financial year, i.e. Apr18-Mar19, not calendar year, 4) operating profit is “Core EBIT”, 4 May 17, 7) including Hamburg Sued from 1 Dec 17, 6) operating profit is EBITDA, 7) Average excluding ONE, 10) incl. OOCL from 7 Aug 18, 11) excl. Long Beach

Container Terminal in 2018 & real estate investments

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CARRIER FINANCIAL RESULTS FULL YEAR 2017-18 (US$ MILLION) Revenue Operating Profit Operating Profit Margin Net Profit

Carrier 2017 2018 % 2017 2018 % 2017 2018 2017 2018 %

Maersk (Ocean business) 5), 6) 22'023 28'366 29% 2'777 3'007 8% 12.6% 10.6% n.a. n.a. n.a.

CMA CGM 2), 4) 21'116 23'476 11% 1'575 610 -61% 7.5% 2.6% 701 34 -95%

COSCO SHIPPING Holdings 1), 5), 8) 12'814 17'376 36% 267 342 28% 2.1% 2.0% 264 252 -5%

Hapag-Lloyd 1), 5), 6) 13'414 15'583 16% 1'419 1'540 8% 10.6% 9.9% 44 63 43%

OOCL (container transport & logistics) 5), 9) 6'078 6'547 8% 105 210 100% 1.7% 3.2% -12 55 558%

Evergreen Marine Corp. 1), 5) 4'933 5'626 14% 223 6 -97% 4.5% 0.1% 229 10 -96%

Yang Ming 1), 5) 4'294 4'715 10% 17 -191 -1236% 0.4% -4.0% 11 -219 -2184%

ONE 3) n.a. 8'054 n.m. n.a. n.a. n.m. n.a. n.m. n.a. -491 n.m.

Zim 5) 2'978 3'248 9% 162 34 -79% 5.4% 1.0% 6 -126 -2200%

Wan Hai 1) 2'045 2'182 7% 106 32 -70% 5.2% 1.5% 86 37 -57%

HMM (container shipping business 1), 5) 3.9 4.2 8% -0.28 -0.45 62% -7.2% -10.8% n.a. n.a. n.a.

Average 7) 89'700.1 107'124.3 19% 6'650.2 5'589.2 -16% 7.4% 5.2% 1'328.8 105.1 -92%

Only six of the 11 top carriers who publish their financial results ended in the black, often with marginal net profits.

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Acronyms and Explanations

AMLA - Latin America OWS - Overweight Surcharge

AMNO - North America PH - Philippines

AR - Argentina PNW - Pacific North West

ASPA - AsiaPacific Ppt. - Percentage points

BR - Brazil PSW - Pacific South West

CAGR - Compound Annual Growth Rate QoQ - Quarter on quarter

CENAC - Central Amercia and Caribbean SAEC - South America East Coast

CNC - CNC Line (Cheng Lie Navigation Co. Ltd.) SAWC - South America West Coast

DG - Dangerous Goods SOLAS - Safety of Life at Sea

DWT - Dead Weight Tonnage SPRC - South People’s Republic of China – South China

EB - Eastbound SSA - Sub-Saharan Africa

ECSA - East Coast South America (synonym for SAEC) SSL - Steam Ship Line

EGLV - Evergreen Marine Corp T - Thousands

EURO - Europe TEU - Twenty foot equivalent unit (20‘ container)

GRI - General Rate Increase TSA - Trans Pacific Stabilization Agreement

HMM - Hyundai USGC - US Gulf Coast

HL - Hapag-Lloyd US FMC - US Federal Maritime Commission

HSUD - Hamburg Süd USEC - US East Coast

HWS - Heavy Weight Surcharge USWC - US West Coast

IA - Intra Asia VGM - Verified Gross Mass

IPBC - India Pakistan Bangladesh Ceylon (= Sri Lanka) VLCS - Very Large Container Ship

IPI - Inland Point Intermodal VSA - Vessel Sharing Agreement

ISC - Indian Sub Continent (synonym for IPBC) WB - Westbound

MENAT - Middle East and North Africa WCSA - West Coast South America (synonym for SAWC)

ML - Maersk Line WHL - Wan Hai

mn - Millions WRS - War Risk Surcharge

MoM - Month-on-Month YML - Yang Ming Line

NOO - Non-operating (vessel) owners YoY - Year-on-Year

OCRS - Operational Cost Recovery surcharge YTD - Year-to-Date

OOCL - Orient Overseas Container Line


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Documents

DHL Global Forwarding, Freight OCEAN FREIGHT MARKET …...The ocean carriers have yet to announce the baseline for their revised BAF calculations and the effective date. Source: Alphaliner,