An independent researcher, Drewry, revised its projections of profits by container line to a gigantic high of US$150 billion for 2021, and the figure has been expressed as an 'eye-watering' figure.

What's behind the upgraded outlook? Firstly, stronger than expected spot rate movement in 3Q21 and a longer supply chain recovery. 

The new estimation is in line with upped earnings forecasts by all major shipping companies based on the positive performance of the second quarter.

An increase across all carriers was found, with some reporting a 50% earnings increase compared to the previous quarter, which resulted from a surge in freight rates. Drewry also says upward adjustments its outlook for global freight rates to 126% from 47% predicted in June. 

High profits are expected for shipping companies in 2022, even a potential decrease in freight rates towards the end of the year. The container shortage is not likely to have relief till 2023 as a result of lags in supply against high demand. Port handling is also expected to increase by 8.2% and 5.2% in 2022. 

On the other hand, Drewry forecasted that there will be little to no impact of the expected decline in spot rates, like a 0.2% decrease last week because of expectations of a significant increase in contract pricing, which will cause a 6% increase in average global pricing in 2022.

For shipping companies worldwide, the ongoing chaos in container shipping is proving to be very profitable. 

To see the source of this news, please follow this link: https://container-news.com/container-lines-set-to-make-record-profits-worth-us150-billion-in-2021/