(Yicai Global) Aug. 31 -- COSCO Shipping Holdings’ stock in Shanghai and Hong Kong soared today, before investors started cashing in, after China’s largest container shipping company posted a 74.4 percent leap in first-half profit from the same period last year, to hit a new high as freight rates continue to soar.

COSCO’s mainland-traded share price [SHA:601919] closed down 1.4 percent at CNY14.20 (USD2). Earlier in the day it jumped 5 percent to CNY15.14. The firm's Hong Kong stock [HKG:1919] was trading down 1.5 percent at HKD11.78 (USD1.50) as of 3 p.m. China time. Earlier in the day it leapt 6.6 percent to HKD12.76.

COSCO raked in net profit of CNY64.7 billion (USD9.4 billion) in the six months ended June 30, according to the Beijing-based company’s latest earnings report released yesterday. The net profit growth rate has slowed down significantly, though, from the same period last year when it surged almost 33 times as a severe shortage of containers due to the pandemic drove up freight rates.

Revenue soared 51.3 percent to CNY210.8 billion (USD30.6 billion), also an all-time high. But growth was slower than last year’s 88-percent clip.

Congestion in the global supply chain has not improved much and the China Containerized Freight Index, which calculates sea freight rates, has increased 59 percent from the year before, the firm said.

Most of COSCO’s revenue came from its Trans-Pacific routes, which rocketed 92 percent in the first half year on year to CNY64.6 billion (USD9.4 billion), according to the report. Earnings from its Europe-Asia route climbed almost 42 percent to CNY54.6 billion. But that from its mainland China routes dipped 1.8 percent to CNY6.2 billion (USD901.7 million).

In the second half, worldwide demand for sea freight should remain steady, COSCO said. As new vessels are delivered, capacity will increase and supply and demand tensions in global container transportation should ease.

And the shipper is expecting 2023 to be even better. Freight costs for the Trans-Pacific route next year are expected to at least double from last year, senior management said in March. And those for its Europe-Asia route could triple or even quintuple. Negotiations for the new contracts have already kicked off.

COSCO is one of the biggest container shipping companies in the world, with a capacity of 2.9 million twenty-feet equivalent units as of June 30. The firm has placed orders for 32 new vessels with a capacity of 585,300 TEUs.

Editor: Kim Taylor