China’s COSCO Shipping Holdings Co has stated that its 2018 first-half profits fell 97.8% as it struggles with freight rates.
The 98% drop translates into a US$6 million loss.
In July, COSCO bought out fellow Asian liner OOCL in a deal that cam to over $6 billion meaning COSCO became the world’s third largest liner and looked to be going from strength to strength, however with several new large ships recently delivered in an industry suffering from an oversupply of vessels and high rates, COSCO has taken a big hit.
The figures may also be the first ramifications of Beijing’s ongoing trade war with Washington, with President Xi of China and President Trump of the US both refusing to back down to the other’s demands.
COSCO, a Chinese state-run liner, has already stated that it doesn’t believe that the US trade war is having an impact, however it has also stated it is willing to protect itself as necessary.
Despite this, Hapag-Lloyd has expressed its concerns regarding how its operation could be impacted.