Oct. 22 (Bloomberg) — China Shipping Development Co., the dry-bulk arm of the nation’s second-biggest shipping group, reported an 81 percent drop in third-quarter profit as rising overcapacity hammered commodity-shipping rates.
Net income declined 81 percent to 292 million yuan ($43 million), or 0.0858 yuan per share, the company said in a statement today. Nine-month profit was 905.7 million yuan.
The Baltic Dry Index, a measure of dry-bulk rates, averaged 61 percent lower in the period than a year earlier as growth in the global fleet (Sure!) outpaced China’s demand for iron ore and other commodities. The shipping line has locked in long-term liquefied natural gas and oil contracts, offsetting the dry-bulk rate drop.