According to UK-based Drewry maritime consultancy, global container carriers are on track for an annual 2021 profit of $80 billion, and this could even stretch to $100 billion  should rates continue their meteoric rise through the second half of this year.

This represents a substantial upgrade to its $35 billion forecast of earnings before interest and taxes (EBIT) made in March. Drewry said spot and contract rates through the second quarter reached record highs, with worsening supply chain disruption continuing to fuel price increases.

“Even if carriers do revert to type and the current newbuild craze ends the upcycle in 2023, they will have made so much money between 2020-22 that they will be set up for years to come,” Drewry noted in its latest Container Insight Weekly.

“They could potentially make as much profit in this window as they could have hoped in a decade, or more.”

First quarter EBIT for the container shipping industry of $27.1 billion eclipsed the full-year 2020 EBIT of $25.4 billion as the highly elevated rate levels were translated into profits.

However, Drewry warned that carriers could pay a price for the soaring profitability.

“Carriers’ only account in deficit is public relations. With increasing attention on shipping’s environmental footprint and tax contributions, lines are in danger of being cast as profiteering villains, unsympathetic to the needs of their customers,” Drewry commented.

 Drewry expects average spot and contract rates across global trades to increase by 50 percent this year, up almost 30 percent on the analyst’s March forecast, which it noted was indicative of the acceleration in pricing already seen through the first half. ‘We are now getting accustomed to seeing triple-digit annual growth rates for spot rates on most lanes,That these instances are no longer shocking is further proof, if needed, that the market truly is crazy right now.” (Photo of containership at Los Angeles by Dreamstime)