Panalpina Welttransport Holding AG, the world’s fourth-largest seafreight forwarder by revenue, reduced its growth forecast for the ocean freight market as shipping capacity outpaced demand.
Panalpina followed industry leader Kuehne & Nagel International AG in projecting growth of 2 percent to 3 percent this year, down from as much as 4 percent predicted in May, a company presentation showed.
“We cut our market forecast as decreasing dynamics in the last months have led us to believe that 4 percent growth is unlikely this year,” said Rainer Weihofen, global head of corporate communication at Basel, Switzerland-based Panalpina.
The container-shipping industry is suffering from a glut after a boom in ship deliveries coincided with the worst slump in freight demand since the 1970s. Deutsche Bahn AG, whose DB Schenker unit is the third-biggest seafreight forwarder, also pared its growth forecast yesterday to 2 percent from 4 percent.
Panalpina is betting it’ll outperform the market after adding customers in the manufacturing and energy industries in the second quarter.
“In the ocean freight business we won clients from the manufacturing sector and the oil and gas industry, for whom we ship equipment such as oil rigs,” Weihofen said by telephone. Panalpina also saw more sea and air trade within Asia, he said. “We want to expand there, as trade in that region is growing most rapidly, for instance between north China and Vietnam.”
Panalpina shipped 5 percent more standard 20-foot containers, or TEUs, across the oceans in the quarter than a year earlier, exceeding market growth of about 2 percent, it said. Gross profit per container rose 8 percent from a year earlier and was little changed from the first quarter, according to its interim statement.
Air freight volumes handled grew in the period for the first time in more than two years, Panalpina said, forecasting that it may be able to outperform the industry in the full year.