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Hapag-Lloyd sees rising freight rates this year
March 27, 2017 / 10:05 AM / 6 months ago

Hapag-Lloyd sees rising freight rates this year

FRANKFURT, March 27 (Reuters) - German container shipping line Hapag-Lloyd expects freight rates to be several percentage points higher this year than in 2016, one of a number of factors that should help the company improve its profitability, it said on Monday.

“Freight rates are still unstable in early 2017,” Chief Executive Rolf Habben Jansen told a news conference.

“But we need higher freight rates to be successful.”

The company achieved an average freight rate of $1,036 per twenty foot equivalent unit (TEU) last year, down around 15 percent from the previous year.

One argument for shipping operators comes from rising bunker (ship fuel) costs, which mirror a recovery in crude oil.

Hapag-Lloyd’s CEO said he estimated average bunker prices of between $275 and $300 per tonne after $210 last year.

Last week, Hapag-Lloyd reported that it slumped to a net loss of 93.1 million euros in 2016 from a 2015 profit of 113.9 million, as positive core earnings were insufficient to offset losses from low freight rates. (Reporting by Vera Eckert; Editing by Maria Sheahan)

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