OCEAN Network Express has reported a decline in profits in the third quarter of the 2022 financial year.

It said its quarterly profit of US$2.77 billion was a “significant deterioration” from the same period last year (down US$2.12 billion) and the previous quarter (down US$ 2.75 billion).

The company said cargo demand decreased, particularly in the east-west trades. Also, port congestion improved over the period, resulting in an increase of tonnage supply.

“The short-term freight rate market deteriorated sharply from 2Q due to a further softening of the supply-demand balance resulting in a sharp fall in profitability compared with bot 3Q FY 2021 and 2Q FY 2022,” the company said in a statement.

Looking forward to the full-year FY 2022, the company forecasts further deterioration in profits in the fourth quarter “due to the softening of supply and demand”. ONE expects a profit of US$240 million after tax for the fourth quarter.

The company said over the fourth quarter the blank sailings are expected to increase due to the longer slack season around Chinese New Year.

ONE is the seventh-largest container carrier by capacity, according to Alphaliner. Its 204 chartered and owned ships have a combined capacity of 1.53 million TEU. Its orderbook comprises 30 ships with a total capacity of 418,430 TEU.