Mainfreight: Trade lanes remain open

Firm’s air and sea cargo for Asia down but China volume on rise

Mainfreight said the world’s freight trade lanes remain open and that its own trading this calendar year remains ahead of where it was in 2019.

“Although we are heading into a period of uncertainty, the world’s freight trade lanes remain open,” the company told NZX.

“All 275 of Mainfreight’s branches worldwide are open and our team is moving freight,” it said.

“While we have seen a decline in air and sea freight to and from our Asian operations, trading across other international trade lanes and . . . within New Zealand, Australia and Europe continues at reasonable levels,” it said.

“More recently, China volumes are re-emerging as factories and ports return to normal operations.”

Mainfreight’s comments about China follow research by broking firm Forsyth Barr last week suggesting China is fast getting back to work after the disruption caused by the coronavirus crisis.

Forsyth Barr said some major industrial centres had recovered to about 95 per cent of normal capacity while the pace of recovery for smaller businesses was at 52 per cent.

Mainfreight said its experience in China “has given us some knowledge of how to operate in this new environment.”

The company said it expects its full-year results through to March 31 “will reflect an improvement on the prior year”.

Although many companies have been reporting serious impacts from the crisis, other companies have provided similar advice that they continue to operate as usual.

For example, rubber products company Skellerup on Monday said its global businesses continue to operate effectively and that trading has been at expected levels.

Briscoe Group managing director Rod Duke said on Monday the worst interruptions to the retailer’s supply chain had likely passed with more than half the group’s factories now running at full capacity, and the rest operating around 70 per cent.

And last week, AFT Pharmaceuticals reported both brisk demand for its cold and influenza-related medicines and that it hadn’t experienced any supply problems from China. AFT also sources products from India, Malaysia, Europe and North America.

Mainfreight’s positive onthe-ground experience isn’t being reflected in its share price which ended the day up 2.3 per cent at $30.18 yesterday. The shares are down 30.6 per cent year to date.