Evergreen Marine Corp (長榮海運) yesterday said it holds a conservative outlook for this year as the US-China trade dispute has slowed the growth of Asian exports to the US, but added that it would improve its edge by using 58 new vessels in the Southeast Asian market.
The shipping company saw its revenue for the first five months jump 24 percent from a year earlier to NT$77.1 billion (US$2.48 billion), as its freight volume to the US and Southeast Asia has expanded, Evergreen Marine chairman Anchor Chang (張正鏞) told reporters after a shareholder’s meeting in Taoyuan.
The shipping arm of Evergreen Group (長榮集團) said it previously forecast that the US-China trade dispute would ease last month and was surprised that US President Donald Trump added to tariff hikes.
“We thought that we would have to battle against headwinds, but it turned out that we secured a lot of long-term contracts, as our clients trusted us and aimed to secure space amid uncertainty stemming from the trade dispute,” Chang said.
Apart from Dragon Boat Festival week, Evergreen Marine has since April sent vessels to the US with almost all of their containers full, he said.
The company’s freight volume to ASEAN members has grown stably this year, after annual increases of 15 percent in the past two years, Chang said.
With the trade dispute increasing the rate that companies are moving production from China to ASEAN, Evergreen Marine would find growth momentum with Vietnam, Thailand, Indonesia, Malaysia, Cambodia and the Philippines, he said.
Evergreen Marine has purchased 58 vessels of 1,900 to 2,800 twenty-foot equivalent units (TEU), as most ports in the region can only accommodate smaller vessels, Chang said.
So far, the company has taken delivery of 18 2,800 TEU vessels, and would take delivery of another 40 by 2022, he said, adding that it would decommission aged vessels when the new ones are received.
Evergreen Marine’s total freight volume would increase in line with global market growth, or an average of 4 to 5 percent within the next five years, he said.
The trade dispute has affected shipping businesses worldwide, with the growth of Asian exports to the US sliding to only 1 percent so far this year, Evergreen Marine president Eric Hsieh (謝惠全) said, adding that imports to China have also dropped.
With higher standards for fuels with lower sulfur content to take effect in January next year, the company has taken a lead over its peers by purchasing 130 scrubbers for its vessels, Chang said.
Evergreen shares yesterday shed 0.4 percent to close at NT$12.45, while the group’s airline arm, EVA Airways (長榮航空), saw its share price plunge 3.85 percent to NT$15, with investors pessimistic over strike action launched by the airline’s union, Taiwan Stock Exchange data showed.
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