News / CIMC profits plunge as global container production hits ten-year low

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Worldwide container production hit a 10-year low, of 850,000 teu in H1 23, according to Wu Sanqiang, secretary at China International Marine Containers (CIMC), the world’s largest box manufacturer.

Mr Wu was speaking at a roadshow on Wednesday that coincided with the release of CIMC’s H1 results, which showed net profit plunging 69% year on year, to $136.6m.

CIMC saw its sales of dry containers fall 61% from H1 22, to 263,100 teu, as “demand corrected in line with the freight market”.

Reefer sales dropped by 25%, to 51,500 teu.

Revenue from CIMC’s core business of container manufacturing fell 40% from H1 22, to $1.89bn, with net profit plunging 75%, to $105.87m.

The company said container demand had “regressed in tandem with the freight market”, following the Covid-fuelled boom in the past three years.

Mr Wu pointed out that CIMC’s latest financial figures had fallen from a high base in those boom years. In 2021, worldwide container production exceeded 6m teu, while container output over the preceding decade averaged 3.2m teu.

And he sought to alleviate investor concerns by saying there were “signs of a recovery”, with CIMC seeing more orders in June than the monthly average through Q1.

He explained: “Following the peak production in 2021, an exceptional event seen once a century, the market needs time to digest the excess containers. Container demand has fallen relatively quickly this year.

“With the continuous introduction of various domestic policies, CIMC expects the container shipping market to stabilise and rebound in H2 23, and logistics demand should pick up in Q4 23. Industry estimates are that demand for new containers could recover to 4m teu in 2024.”

Meanwhile, in the notes to its H2 23 results, CIMC said that, in anticipation of greater demand for cold chain logistics, the company had formed a joint-venture with Guangxi Supply and Marketing to import tropical fruits into China.