High oil price and off-season have fettered the progress of national shipping lines. As shown in the record of first quarter, domestic shipping industry have yet to get away from the deteriorated profitability.

STX Panocean is reported to have recorded 133.1 billion Won of business loss in the first quarter. Its sales reached 1 trillion 232.2 billion Won, down 9.3% compared to the same period previous year and the net loss totalled 118.2 billion Won.

Hyundai Merchant Marine(HMM) has continued deficit operation for 5 consecutive quarters with sales of 1 trillion 800.0 billion Won and business loss of 200.8 billion Won for the first quarter. Its sales increased by 9.3%, however profitability deteriorated.

Hanjin Shipping is no exception to such poor results. The business loss of the first quarter showed 218.4 billion Won. The sales decreased by 0.5% recording 2 trillion 264.1 billion Won and the net loss showed 338.3 billion Won.

It is analyzed that these low performances result from poor market conditions overlapped with off-season(1st quarter). Especially high oil price is a brake on the recovery of shipping companies.

According to the industry sources, the average price of bunker C oil(for 380CST), which was 653 dollars per ton last year, soared to 700 dollars in the first quarter this year.

For this reason, the shipping industry is struggling to draw up cost reduction programs of their own. On one hand they are concentrating on the risk management including business restructuring, on the other they are planning to increase the freight.

In spite of such an effort, over supply of the vessels has kept sustaining low freight and high oil price has brought about poor business results. But the condition is predicted to get better from the second quarter based on the additional freight increase.

A staff in the industry said "As current shipping market conditions have shown signs of bottoming out and the freight has sharply risen over March-May, we expect the impact will turn up from the 2nd quarter."