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Stolt-Nielsen expects higher charter rates in second quarter

Stolt-Nielsen Stolt-Tank-Containers.jpeg
Announcing results lifted by a strong chemical tanker market in the first quarter, Stolt-Nielsen said it expects even better charter rates in Q2.

The group said results for Stolt Tankers were supported by restricted transits of both the Panama and Suez canals, soaking up tonnage in an already tight market and bringing record freight rates.

“From an operational perspective this creates several challenges. However, Stolt Tankers is continuing to work closely with its customers to minimise any negative impact on their supply chains,” the company said in its earnings statement.

The outlook for the chemical tanker market was positive, aided by a firm product tanker market and low orderbook. Stolt-Nielsen expects a further increase of 6-8% in average charter rates in its second quarter results.

Operating profit at the tanker arm of the group was up at $93m compared to $87.1m in the same period last year.

Udo Lange, Chief Executive Officer of Stolt-Nielsen Limited, said: “Spot rates continued to strengthen through the first quarter and we should start seeing the effect in the second quarter onwards. That said, we have seen some contract volumes decline as our customers adjust to the impact of supply chain disruptions.”

Elsewhere in the group, Stolthaven Terminals posted record operating results which it attributed to a return to growth in chemical output and demand from speciality liquids, including biofuel feedstocks. 

“We anticipate a flat first half of 2024, with slightly improving earnings during the second half of the year as we continue to optimise our contract portfolio,” the company said.

Lange noted a record number of shipments for the company’s tank containers operation at 40,047, an increase of 22% from the same quarter last year. Stolt Tank Containers has pursued a market share growth strategy after a period of margin erosion.

TAGS: Europe Ports