China adopts the lunar calendar and we do the solar calendar so that the New Year begin from Feb.7th (Sun) to 13th (Sat) for 7 consecutive official holiday days in China this year. Feb.14 (Sun) is a substitution holiday work. May there be many people who cannot get rid of feeling of New Year holidays this week. It is said that the container factory will close more than one month. So we will have to wait till March when the container industry in China come back to normal.
The Lunar New Year is the most important and traditional holiday in China. It is called “Spring Luck” from Jan. 24 to Mar.3 for 40 days when the great nation migration to return to the hometown happens. They say that a total 2.9 billion people move during the period this year. The energy of making them move would be beyond our imagination. May the powerful energy of China be born from this Lunar New Year? I wish they would heal fatigue of one year on a holiday of the Lunar New Year and they develop vitality of another year and they continuously pull world economy as the world’s factory. China occupy 12% of world crude oil consumptions and approximately 15% of world GDP. Thus, the economic slowdown of China would affect every country. China saved the world by economic measure of 4 trillion yuan (approximately 60 trillion yen) at the time of the Lehman shock occurred in Sep. 2008. Therefore, how could China handle over-capacity, the problem of the surplus debt and bad debt? I want to expect it for the next move of China.
President Kuroda of Bank of Japan announced on Jan. 29 a negative interest rate (monetary policy with a part of the checking account to take from the bank as minus) in order to create a weak yen, to lead high stock prices and investment by cash recurrence into market. The world falling stock prices do not stop. The New York stock Feb. 11 posted the lowest price for the first time in 2 years, $15,660 and recorded 1 barrel =$26.05 (the lowest price of crude oil for the first time in 12 years 9 months) in the U.S. market. On Feb. 12 the Nikkei Stock Average was 14,876 yen, the lowest for 1 year 4 months. The yen posted $1.00=111.88 yen. It became the strong yen of 8.74 yen compared with $1.00=120.62 yen of Jan. 30. Japanese yen of the low risk currency was bought.
The economy of the oil-producing country has turned worse after the lengthening of the low price of crude oil. Therefore, they have been pulling out the funding from the world stock market to solve a budget deficit. European and American bank stocks have been dropping in price out of concern of the financing aggravation with the bad debt of the financial institution by the fall of the resources price. The hedge funds have been driven into closedown, liquidation of the fund by the aggravation of fund operative results. Due to future concern of the world economy and risk aversion the world investment money moves to the government bonds and gold which consider safe assets
On the other hand, the total sum of mergers and acquisitions (M&A) of 2015 reached the highest record for the first time in 8 years (exceeded 5 trillion yen). As for the characteristic of M&R of 2015, the item which exceeded 10 billion dollars (approximately 1,180 billion yen) seemed to increase 90%. The major company move to M&A because they could anticipate growth on long term while resource prices are lower and the world economy goes dull. M&A aims at scale expansion without investing and it could reduce a rival which is a means of the killing 2 birds with one stone. Composition of upsizing and oligopoly would be seen to continue for a while. We should think it to be always “Business Chance” in the turning point of the flow of the economy.
According to the trade paper, “Shipping Guide” the marine transport volume of 2015 by reefer boats and reefer containers are 105.5 million tons equivalent to 3.35 million TEU. It shares 2.7% of dry cargo movement. The total number of the reefer containers at the end of 2015 is 2.6 million TEU (6.5% increase compared with 2014). Reefer cargo anticipates an annual rate of 4~5% of growth till 2020. On the other hand, the share of the reefer boats decreases from 60% of 2000 to 26% of 2014. The number of the reefer boats are anticipated to decrease to 41% by 2025. The liner of the shipping company lays emphasis on the reinforcement of the reefer container to replace the space of the reefer boats.
Magnum Plus made by Thermo King, reefer unit maker has the ability that -10 degrees C is lower than other makers. It could cover the temperature range from -40 degrees C to +30 degrees C. Therefore, Magnum Plus is most suitable to carry a frozen tune, ice cream to maintain a high quality of goods in deep frozen temperature. It has a powerful machine to make the inside of the container freezing quickly so that it is quite effective to be used in the area of high ambient temperature. As a result, it is an energy-saving refrigerator. Besides, it could be equipped with AFAM (passive CA) controlling O2, CO2 of every vegetable and fruit as required. In addition, the active CA (Optima) keeping the most suitable freshness of vegetables and fruits controlling with nitrogen gas would be introduced soon in the market. Magnum Plus has been increasing the market share with the attention of many shipping lines these days.
The current new production price of dry container is $1,400 per 20f, the total number of new container production stock in China factory is 1.6 million TEU. The last minute surge in demand before the Lunar New Year by shipping companies was seen and it was resulted that shipping companies replaced with the new containers including the rest of L/T as well as own one.
I quickly visited Shimonoseki, Moji, Hakata and Oita to see the regular customers and to inspect 20f sliding door containers in middle of Jan for the first time in 2 years. North Kyushu District was full of Chinese, Korean tourists as an Asian doorway. I think that Kyushu can call more tourists from the foreign countries if Kyushu could produces a characteristic of Kyushu more. Of course, I came home after I thoroughly enjoyed fresh fishery products, ramen and magnificent nature in Kyushu.
EF International performed increase of capital of 5 million yen in January and the paid-up capital was increased to 20 million yen. This is to meet quickly with increasing order, especially for coping with big orders. In addition, we will plan to move to the new office near JR Sakuragicho Station in April. We intend to make our customers satisfied with our service by increasing staff and in the double of space of the new office.