Container line ONE did not include a full year forecast for 2023 in its 2022 results, saying the outlook for 2023 is extremely difficult to predict.

Gary Howard | Apr 28, 2023

In its 2022 full year results presentation, Ocean Network Express (ONE) said the container market was in the midst of major changes including the aftermath of global supply chain congestion, macroeconomic changes and trade flow shifts due to war and other geopolitics, and changes in consumer behaviour.

“Under these circumstances, it is extremely difficult to announce a reasonable business forecast at this time and the full-year forecast for FY2023 is yet to be determined,” ONE said.

Other container lines have stressed the difficulty of forecasting for 2023, but generally produced figures showing a drop in earnings and revenue as demand and rates fall—or normalise as Maersk put it—through the year.

Maersk’s best-case scenario for 2023 when it published its 2022 results in February was an 84% decline in profit year-on-year. That result is in line with a forecast from analyst John McCown of Blue Alpha Capital who forecast an 80% drop in profits at the major container lines in 2023.

ONE’s 2022 results showed a $15bn profit, down $1.7bn on-year as market conditions weakened in the second half of the year. A decline in demand was more pronounced in Q4, said ONE, as the supply and demand balance weakened despite blank sailings.

Improved freight rates in 2022 reflected stronger contract rates, comfortably compensating for lower spot rates later in the year. Those stronger freight rates stacked against higher bunker costs, higher operational costs, higher variable costs and the decrease in lifting.

ONE said it had felt no significant impact from the scheduled delivery of multiple vessels into the market in recent months.

The company’s response to the changing market was to extend the blank sailing period around Chinese New Year into March and April, route vessels around the Cape of Good Hope to absorb capacity, increase port coverage, slow steam vessels, and deploy larger vessel on the East-West trades ahead of schedule.