Maersk sees further shake-out in container shipping industry

The operator of the world's largest container ship fleet, Maersk Line, said the shake-out in industry is not over, CNA reports.
Maersk Line Asia Pacific's chief executive officer Thomas Knudsen told Channel NewsAsia trading conditions have improved but industry consolidation has a way to go.
Mr Knudsen said: "We're still not at a situation where the industry in the long term is sustainable. So what we're really looking for is improving the product we deliver to our customers. I think that goes to the industry taking out costs through our bunker consumption and fuel consumption and then focusing on costs in general.
"I think we've focused a lot on reducing our fuel costs in our ships. That has taken out a lot of costs out of our business. And then we have matched our vessel capacity to the demand. That has also meant we've been able to maintain rates at an acceptable level the last quarter."
The parent company, AP Moller-Maersk returned the container unit to profitability in the second quarter after cutting nine per cent of shipping capacity on its largest trade route, Asia to Europe, in February.
Maersk Line swung to a second quarter profit of US$227 million, compared to a loss of US$95 million in the same period last year.
Maersk has also managed to push up its average container freight rate by 4.2 per cent to US$3,014 per forty foot equivalent unit.
Mr Knudsen said: "We had a very poor first quarter. We did a lot better in the second quarter and a lot of that was focused on improving our utilisation of ships and pushing rates up at the same time.
"What's interesting is actually a lot of customers are not complaining about this. What they're really frustrated about is the major fluctuations with prices moving up and down."
Container lines like Maersk bled money in 2011 and the earlier part of 2012 as freight rates plunged from an oversupply of vessels while the European debt crisis worsened the situation.
And while Maersk Line reports stronger growth in its Asian business, Mr Knudsen said slower business on its container transportation routes in North America and Europe, will continue to hurt Asian operations this year.