U-Ming Marine Transport Corp (裕民航運), a bulk shipper and member of the Far Eastern Group (遠東集團), yesterday said it aimed to maintain its profitability by upgrading its fleet amid a persisting headwind of oversupply.
The Baltic Dry Index (BDI), a measure of shipping costs for commodities, has shown a decline of more than 20 percent from a month ago and reached 1,499 points on Thursday, indicating weaker demand in the industry.
“There are still too many vessels operating in the market,” U-Ming Marine spokesman Stephen Chen (陳秀能) told a media briefing.
In the long run, Chen said the supply-and-demand issue may further improve, as the global economic recovery will continue boosting demand, with bulk shippers’ fleet replacement helping balance newly added supply.
U-Ming Marine is ready to accept six new vessels next year, Chen said, adding that new ships with better fuel consumption could help the company control costs.
Meanwhile, the company signed various middle to long-term contracts with customers last month — when the BDI reached its highest level for this year — to ensure a steady freight rate and profitability this quarter through next year, Chen added.
U-Ming Marine posted NT$433.11 million (US$14.61 million), or NT$0.5 per share, in consolidated net income in the period from July to September, down from NT$512.88 million, or NT$0.6 per share, a year earlier, company data showed.