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Rate hike may get Evergreen, Yang Ming into black

TAIPEI, Taiwan -- Following another rate increase, Evergreen Marine Corp. (長榮海運) and Yang Ming Marine Transport Corp. (陽明海運) are expected to swing to proift in the latter half.

Yang Ming and Evergreen, the top two shippers in Taiwan, collectively implemented another general rate increase (GRI) on the Asia-U.S. trade lane since Aug. 1. The rate increase was recommended by the Transpacific Stabilization Agreement (TSA) on July 20.

Given a boost by pervasive freight rate hikes for U.S. trade lines, Yang Ming Marine scored revenue of NT$12.227 billion for June, up 10.82 percent month-on-month, or 5.87 percent year-on-year, to a 23-month zenith, according to its latest financial report. Yang Ming on Monday reported NT$12.39 billion of consolidated revenues for July.

Obviously recovering from a low season in the first quarter, when Yang Ming Marine suffered net losses of NT$0.48 per share, the firm finished the second quarter with NT$34.284 billion, a 21.39-percent increase from the previous quarter, according to the report.

With currently prospering business along both the U.S. and European trade lines, Yang Ming's chairman, Frank Lu (盧峰海), says that the shipper is very likely to turn profitable in the second quarter, and will see better performance in the second half than in the first half.

Lu said that the ongoing economic recovery in the U.S., which has driven market demand for shipping, is the main factor among others sustaining the current high freightage for trade lines to the country, while the steadily improving economy in Europe is also helping to raise rates for Asia-Mediterranean Sea routes higher than those for trans-inland European waterways.

With the peak summer season benefiting the global shipping industry along with an increasingly brightening global economic outlook, Lu emphasized that the shipper will surely see stronger performance in the third quarter than in the second.

Prospects Brigthens for Sector

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