Sinotrans' Bunker Spend Fell by Over One-Third Year on Year in 2016

Sinotrans spent $108.76 million on bunkers in 2016, down from $164.48 million in 2015.

Sinotrans Shipping Limited (Sinotrans), in its financial results for the 2016 year, reports it spent more than one-third less on bunkers year on year, having declined to $108.76 million in 2016, down from $164.48 million in 2015.

Meanwhile, the company's costs for lubricants, spare parts, and materials expenses declined to $12.6 million in 2016, down from $25.29 million in 2016.

"The Group replaced several chartered-in vessels, ordered bunkers and leased containers at relatively low prices, by which improved its business performance. The Group consequently achieved profits for the third consecutive year," explained Sinotrans of its container carrier business.

Overall, for the year ending December 31, 2016, Sinotrans achieved revenues of $841.46 million, down from $999.77 million the previous year.

The company says that it expects capacity growth will continue to slow down in 2017, with the growth rate of supply predicted to fall lower than that of demand for "the first time over years," a development that it suggests brings hope for market recovery.

"Compared with the global container shipping market, business activities among Intra-Asia are more active and the competition landscape of container routes tends to remain stable, which shows a positive sign in freight rate," said Sinotrans.

"However, the business performance of the Group may be affected to certain extent due to various uncertainties including geopolitical risks, rise of trade protectionism and fluctuation in bunker prices."