FRANKFURT (Reuters) -Hapag-Lloyd has seen an increase in demand for freight traffic this week between the United States and China, following a cooling in the countries’ trade tensions.
The U.S. and China on Monday agreed to slash steep tariffs for at least 90 days, suspending a trade war between the world’s two biggest economies that prompted fears of a global recession.
When asked on Wednesday about Washington and Beijing’s tariff truce, CEO Rolf Habben Jansen told Reuters: “I expect that there will be additional volume between China and the U.S. That is what we have already seen in the last few days.”
“It remains to be seen how long this will take and whether demand will become even stronger,” he added.
The German container shipping company’s bookings were up 50% for U.S.-China traffic week on week in the first few days of the week, the CEO said.
Hapag-Lloyd’s shares were up 7.31% at 1341 GMT.
The company earlier on Wednesday reported a 27% jump in first-quarter earnings before interest and tax, or EBIT, to 463 million euros ($519.44 million), partly because many Chinese manufacturers brought forward consignments to the United States to preempt anticipated trade barriers.
Habben Jansen said the company was deploying ships of different sizes to adjust to volatile demand.
“Our problem is, of course, that ships unfortunately are not elastic,” he said.
Under the temporary truce, the U.S. will cut extra tariffs it imposed on Chinese imports last month from 145% to 30% for the next three months, the two sides said, while Chinese duties on U.S. imports will fall to 10% from 125%.
Hapag confirmed its guidance for full-year EBIT between breakeven and 1.5 billion euros, “subject to a very high degree of uncertainty”.
($1 = 0.8913 euros)
(Reporting by Elke Ahlswede, Writing by Rachel More and Ludwig Burger. Editing by Jane Merriman)
