Container Market Report March 2015

Every morning I go along by the temple toward JR Higashi-Kanagawa station for work. The temple is famous for its cherry blossoms, where it is located at the hill. I have to walk up a bit steep hill but from the hill the road descends a gentle slope. There is the 2 stored pagoda of the temple. I walk toward its pagoda. I could not clearly remember when but I have come to feel it beautiful the color of verdigris on the roof of the pagoda. Dark green but it is hard to express its color. This is why it is specially named as the color of verdigris. It has already passed over half a century for me to see it. I recognize that the color of verdigris on the roof has been more vivid as the years went by. However, it is from autumn to winter that I could enjoy seeing the color of verdigris on the roof. In spring the temple is covered with cherry blossoms because it is famous for its cherry blossoms. It looks gorgeous. After cherry blossoms fall the pagoda is covered with the new leaves of tender green of cherry trees. The leaf of trees sends out buds like a brick. Leaves grow thick in deep-blue soon and it disappears from my view. A season rotates. The chilling wind is disrobing the trees of their leaves. The roof of verdigris appears. Its color is really bright in a skin color of trees. The roof of verdigris goes out of my view soon after gradually covered by the fresh green. It reminds me of the round of the seasons.

Economic circulation seems to be the same as the workings of nature. It looks to alternatively repeat good and bad condition for certain period of time. In view of a micro and macroeconomic activities it happens in any situation. In the marine transportation industry prosperity should come after depression. In Japan time lag on container lease demand used to be periodically appeared strong and weak till 1990s during my experience of leasing company. Kanto region was weak in container demand but Kansai region was strong or vice versa. It was when Japan shared 60~70% of total export ex Asia. A large number of lease container had been returned by shipping lines in Japan at that time. The inventory control in Japan was a matter of life and death to the leasing companies especially if they should be moved to other demand places or they should be kept till the demand opportunity under strong yen.

Economy goes around. We should not be pessimistic if the economy is bad at the moment as good time rotates again. It is important for us how to endure such hard time. We have to be required to prepare for the next chance by developing our ability like trees bud all at once in spring. I feel keenly aware that we should not spare our efforts in order to realize our dream.

The employment of the non-agriculture section of Feb. in USA is 295,000 increase. The unemployment rate of Feb. went down by 0.2% to 5.5% compared with the month before. The low price of crude oil will encourage individual consumption which account for 70% of GDP. The unit sales of new cars in Feb were 5.5% increase to 1,256,619 from a year earlier. It was high level since 2006. China revised real economic growth rate of 2015 to 7% and they will aim at the steady growth. They advocate new work force target more than 10 million in an urban area.

The yen posted $1.00=121.29 yen on Mar 6, which is the lowest in 3 months. Japanese car makers have been receiving a weak yen effect. In Fuji Heavy Industries export number exceeded last year for 23 consecutive months. The export number of January of Nissan Motor is 41.3% increase from a year earlier. Canon declared that they will increase the current domestic production ratio than 50% from current 40% within 2 years. The weak yen could support the domestic recurrence of the Japanese production section. I would like to expect that the brand power of “made in Japan” of the Japanese makers would revive.

New container price is unchanged as $1950 per 20f. Factory inventory in China comes close to 850,000teu. New Year holidays were over but the movement seems to be still dull. The strike of USWC was evaded but the influence would be immeasurable. It is said that it takes 3 months or half a year before harbor loading and unloading in USWC will return to normal. In the other hand we hear that the port facilities in North America couldn’t properly handle larger ships which have been cascaded from Europe route. A larger ship could reduce the unit price per slot. However, a larger ship could be one of solutions but not absolute when we think about other operation costs to accompany it.

To operate ships in the most economical speed is to meet with necessities in the ages which requests no stock of the auto-parts in the factory like just in time but keeps the stock on the vessels instead. In view of customers the next day delivery would be ideal like Amazon. It must be 100% of customer satisfaction. In that sense it may be the best way to choose the right capacity of a ship for the service route in order to satisfy customers with smooth delivery. It could expect more efficient in the use of the containers. Everybody should not chase larger ships. There should be diversification in service. There may be the way to compete by different way of thinking.

EFI passed in full 5 years in this March and has entered in the 6th year. EFI has undertaken agency and exclusive partnership of 7 companies now. I would like to introduce them once again with their products.

1) Kukdong MES/JJ MES
to start Mar. 2010, Korean ISO container trader of over 20 years history  with the network of China, Asia, Middle East and in the world.

2) Future Box Corporation
to start Feb. 2011, Korean Patent holding company of ISO  container and  to sell it the world major shipping companies.

3) TydenBrooks
to start Mar. 2011, USA with the history of over 100 years to sell the security seal in the  world like shipping lines, Airline, global/local seal users.

4) Mirai Hi-Tec
to start May 2012, Korean middle sized company.  EFI already sold 9 yard chassis so far.

5) UES International
to start Jan. 2013, Hong Kong, No.10th leasing company in the world with  the worldwide depot network.

6) Thermo King
to start Jul. 2013, USA with the history of over 100 years, refrigerator,  generator maker to introduce the first reefer container in the world.

7) MCC Tank
to start Aug. 2014, China, a subsidiary of the state-run Metallurgy maker (302 ranked out of Fortune Global 500)

Their sales have been increasing gradually as our name, EF International has been well known among our customers. We are confident that each of product could do business as one of independent companies. We would like to express our heartfelt appreciation to all of you who supported us for the past 5 years and we want to greatly grow up towards the next 5th year to meet your strong expectation in order to attain your satisfaction of 100% by working hard.