Container-shipping profits have soared during the pandemic to levels that industry veteran John McCown has variously described as “mind-bending” and “mind-altering,” peaking at $64 billion in the second quarter of this year.
That officially marks the crest of the industry’s explosive growth, which was driven by clogged ports and other supply-chain disruptions that allowed container ships to charge a high premium amid high demand. Last quarter’s earnings came down slightly from the peak, clocking at $58.9 billion.
“The 2Q22 actual results can now be recognized as the peak in terms of earnings,” McCown said in his latest quarterly report on the industry. The second quarter ended seven straight quarters of record profits, and “there will be further declines from 3Q22 in quarters to come,” McCown said.
Some analysts expect that dive will be of the deep-water variety, with profits falling as much as 70% for some carriers in the next quarter. Shipping giants like Maersk anticipated this decline from the pandemic’s shipping heyday, and have been investing in end-to-end logistics to control more parts of the supply chain, like airline and trucking routes.
The profits from this historic period in the container-shipping industry will be a huge advantage as companies like Maersk make that shift.