World News
Eco-Ships Help Hapag-Lloyd Reduce its Bunker Costs
Hapag-Lloyd says it reduced its bunker expenses in the first quarter of 2014 through the use of more efficient modern vessels and the decline in fuel prices, but not enough to make up for falling freight rates.
The carrier reported revenues of €1.55 billion ($2.12 billion) in Q1, down from €1.65 billion ($2.26 billion) year-over year, due to a weakening U.S. dollar and low freight rates.
The average freight rate for the quarter was $1,422 per twenty-foot equivalent units (TEU), down from $1,546 in Q1 2013.
Hapag-Lloyd paid $595 per metric tonne (pmt) on average for fuel in the quarter, down from $627 pmt in the same period last year.
"However, this still represents a very high overall level that cannot be compensated for in any way by current freight rates, which are far too low," the company said.
Hapag-Lloyd credited the use of efficient vessels including 13,200 twenty-foot-equivalent unit (TEU) newbuildings with some reduction in its fuel costs, and it also says it reduced other costs including charter rental charges, leases, and containers.
The company's net result for the quarter was a loss of -€119.1 million (-$163.3 million), compared with -€93.6 million (-$128.3 million) in Q1 2013, but that includes one-time costs related to the takeover of CSAV's container business.
Hapag-Lloyd has said its fuel costs will increase significantly when new emissions rules take effect in Emissions Control Areas (ECAs) in 2015, necessitating new surcharges.
Key Bunker Prices More
| VLSFO | MGO | |||
|---|---|---|---|---|
| $/mt | +/- | $/mt | +/- | |
| Singapore | 511.00 | 6.50 | 590.50 | 2.00 |
| Rotterdam | 451.00 | 7.00 | 597.00 | 8.00 |
| Houston | 450.50 | 4.50 | 602.50 | 14.50 |
| Fujairah | 498.00 | 3.50 | 710.00 | 3.00 |
| Global 20 Ports Average | 526.00 | 6.50 | 700.50 | 6.50 |
| Global 4 Ports Average | 477.50 | 5.50 | 625.00 | 6.00 |
| Global Average Bunker Price | 564.50 | 3.50 | 747.50 | 2.00 |
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