News / Container manufacturers expect softer demand after 'challenging' first half

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Following the release of their H1 25 results, container manufacturers are expecting a correction in demand for new containers to last until year-end.

Singamas, the fourth-largest container maker, is predicting “lacklustre demand” for new boxes.

While its revenue was up 4%, from H1 24, to $251.63m, its net profit fell 13%, to $14.97m, due to higher costs.

Sales of new containers totalled 84,000 teu, down from 93,000in H1 24, and its average selling price fell to $1,845 per 20ft, from $1,918 a year ago.

Singamas chairman and CEO Teo Siong Seng said the first six months of the year had been challenging and the rest of the year would not be easy. High orders in 2024 and weakening freight rates on long-haul routes are expected to curtail demand for new containers.

Mr Teo said: “In addition, protectionist trade policies imposed by the US administration, brought uncertainty to the market. Although the tariff exemption period boosted export demand in the second quarter, freight rates and container prices remained low due to excess capacity and intense industry competition. Export volume is expected to decline in the second half year, hence container demand is anticipated to be lacklustre.”

He continued: “However, with raw material costs declining simultaneously, industry players will capitalise on this development by further controlling costs to maintain margins and profitability.”

Cosco Shipping Development (CSD), the second-largest manufacturer, saw revenue rise 4% year on year, to CNY12.16bn ($1.7bn), with n. Net profit up 15%, to CNY1.04bn.

Container sales were up 14% from H1 24, to 845,700 teu, and revenue from container manufacturing was up 7%, to CNY8.49bn.

CSD’s businesses includes ship and container leasing, projected a positive outlook, believing record newbuilding deliveries would generate demand for new containers, while old equipment will need replacing.

Market leader China International Marine Containers (CIMC), meanwhile, saw H1 25 revenue dip 4% year on year, to CNY76.09bn, and reducing costs enabled net profit to rise 26%, to CNY 1.76bn.

While sales of dry containers fell to 1.13m teu from 1.38m teu in H1 24, reefer sales improved, to 92,000 teu, more than double the 44,700 teu in H1 24. CIMC attributed the increased reefer demand to robust South American fruit exports to Asia and firm cold chain freight rates.

But CIMC is also expecting soft demand for containers for the rest of the year. It said: “The uncertainty surrounding US tariff policies will continue to fuel concerns about global economic growth, which in turn will impact the demand for containers in the short term.”