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S. Korean shippers forecast to log record earnings for Q3

South Korean shipping lines are expected to chalk up record earnings for the third quarter of the year thanks to surging freight rates, a market tracker said Tuesday.

HMM Co., South Korea's largest container shipper, is projected to post a consolidated operating income of 1.82 trillion won ($1.54 billion) for the July-September, according to an analysis of brokerage house forecasts.

That would break HMM's operating income record of 1.39 trillion won set in the previous quarter, which was up 901 percent from three months earlier.

In the fourth quarter of this year, HMM's operating profit is forecast to range from 1.4 trillion won to 1.9 trillion won, according to the analysis conducted by Yonhap Infomax, the financial news arm of Yonhap.

Pan Ocean Co., South Korea's second-largest shipper by sales after HMM, is predicted to register an operating income of 140.7 billion won for the current quarter, up from 112 billion won three months earlier.

Local securities firms' sanguine outlook for shipper earnings comes as freight rates have been soaring since the third quarter of last year.

The Shanghai Containerized Freight Index, a barometer of global freight rates, stood at 4,643.79 on Friday, growing nearly fourfold from a year earlier.

The Baltic Dry Index, a yardstick of shipping costs for commodities, stood at 4,644 on the same day, about three times the level a year earlier.

In addition, cargo handling has been rising sharply this year. The monthly average of container cargo amounts to around 15 million twenty-foot equivalent units (TEUs) this year, up from 12.52 million TEUs before 2020. (Yonhap)