Japanese big three savour last boom

Japan - NYK, MOL and "K" Line have released parallel strong figures in their latest fiscal reports, but echoed similar outlook on the dark clouds looming in the shipping industry heading towards recession.

For the July-September quarter, NYK Lines (Nippon Yusen Kaisha) increased its revenue by 13% year-on-year to ¥740.2billion (US$7.45 billion). The company's income grew by 49% to US$254.8 million.

MOL (Mitsui OSK Lines) reported a similar trend for the half-year period, with year-on-year revenue up 15% to approximately US$11 billion and a 10% increase in net income at US$1.25 billion.

"K" Line (Kawasaki Kisen Kaisha) reported half-year revenue up 14% to US$7.40 billion and a jump in net income of 16%.

However, prospects for the next half year are expected to be less buoyant.

"K" Line and MOL forecast lower profits, with the latter anticipating a possible 50% decline of income in the next half-year.

According to media sources, an indication of the potential seriousness of the situation for the Japanese lines is the extreme volatility of the Baltic Exchange's bulk shipping rates.

These have crashed to a six-year low after experiencing record highs last year.

MOL also recently announced a new independent service on the Asia-East Coast South America trade starting in January 2009.

According to Akimitsu Ashida, president of MOL, the current joint service with Pacific International Line (PIL) will be dissolved.

By replacing some of current 3,000 TEU (twenty-foot equivalent unit) class vessels with larger and faster ships, MOL aims to provide stable cargo capacity and higher schedule integrity to meet customer demand in this growing market.

MOL said calling ports and transit times are expected to remain unchanged from the existing PIL service.