World News
CSAV Returns to Profitability After Major Restructuring
After seven quarters of losses, Chilean shipping company Compañía Sud Americana de Vapores (CSAV) reported that it returned to profitability in the third quarter of 2012 after a restructuring campaign that suspended much of its services on Transpacific, Asia-Europe, and intra-Asian routes.
The company reported a profit of $55.8 million in Q3 2012, compared with a loss of $357.5 million for the same quarter last year.
Revenues for the quarter fell to $854.7 million from $1.15 billion in the same period last year.
"Container shipping services bunker cost is the main single component of CSAV's cost of sales, representing 24.2 percent in the third quarter of 2012," the company said.
CSAV reported the price of bunkers decreased during the quarter, reaching an average of $647 per metric tonne (pmt), a decrease of 10.3 percent compared to the second quarter of 2012 and 1.4 percent compared to the third quarter of 2011.
The company reduced its transported volume by 37.6 percent year-over-year as it concentrated its focus on the South American markets "where CSAV has a competitive advantage."
The reduction in volume was partly compensated by a 23 percent increase in average revenue per twenty-foot equivalent unit (TEU).
CSAV said the shipping industry has been "facing an adverse market situation since late 2010," with problems in the global economy, an oversupply of capacity, and high oil prices.
"Low freight rates, coupled with low vessel utilization rates and the rise in fuel costs, have had a severe financial impact in the industry," the company said.
"The balance between supply and demand in the industry is still very unstable."
In recent months, shipping companies have said that some Asia-Europe routes cost more to operate than they produce in revenue, although a report today said rates on the routes are up 22 percent to $1,315 per TEU and the turnaround in 2013 is now "highly visible."
Key Bunker Prices More
| VLSFO | MGO | |||
|---|---|---|---|---|
| $/mt | +/- | $/mt | +/- | |
| Singapore | 629.00 | 2.00 | 738.00 | 1.00 |
| Rotterdam | 572.50 | 6.50 | 740.00 | 13.50 |
| Houston | 593.50 | 6.00 | 753.50 | 11.00 |
| Fujairah | 626.50 | 4.50 | 885.00 | 3.50 |
| Global 20 Ports Average | 646.00 | 0.50 | 825.50 | 1.50 |
| Global 4 Ports Average | 604.00 | 2.50 | 784.00 | 4.50 |
| Global Average Bunker Price | 700.00 | 3.50 | 883.00 | 3.00 |
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