While consumers, manufacturers, and shippers are struggling to cut costs and remain afloat during these trying times – ocean carriers, specifically the Japanese carrier Ocean Network Express (ONE), are reporting some of the highest profits to date.
Ocean carriers continue to show profitable growth, and ONE line has seen profits increase each month. Xeneta’s Shipping Index (XSI) reports “Long-term rates recorded their tenth consecutive month-on-month rise in October, climbing by 2.2%. This indices now stand at a colossal 93.1% up year-on-year”.
Why the increase?
In the US, congestion at port terminals remains a huge issue, and terminals are thinking of creative solutions to lessen port congestion, including charging shipping companies fees for containers remaining at the ports for extended periods of time. As a result, contracted rates are have increased to offset the costs, citing “Cost-saving initiatives progressed, but additional costs increased due to shoreside and inland congestion.”
ONE line can also attribute the success to more reliable shipping. “Operation costs increased due to faster vessel speeds to improve schedule reliability.” Read More Here
While ONE line is seeing their highest profit ever this year, they aren’t alone. Ocean carriers worldwide are benefiting, and we should expect to see ocean rates continue to rise.