In line with the global crisis, the group profits of Japan’s second largest shipping line, Mitsui OSK Line (MOL) – which is a major player on the SA trades with the Far East, Europe and South America – took a serious nose-dive in the 2008/09 financial year (ending March 31, 2009). It recorded a painful 33.3% year-on-year profit drop to US$1.3-billion from US$1.9- bn. This from a lesser 4.1% slip in its turnover from US$20-bn to US$18-bn. The global slump, bunker costs, seriously slipping freight rates and a stronger yen combined to reduce gains, said a line statement. MOL's container division was one of the worse performers in the group’s multifarious shipping activities. It suffered a US$241-million loss, as container sales fell 6.9% to US$6.6-bn. Noting this “significant” profit drop in the containership segment, the MOL report said that it had laid up surplus vessels to reduce space and offset the fall in trade. “We also took action to minimise losses and routes where competition is intense and profitability difficult or impossible. “However, freight rates on all routes, including Asia Europe, dropped while cargo volume declined and competition increased, and our cost-cutting efforts did not offset the falling rates.”
