CIMC, the world's largest maker of shipping containers, forecast Wednesday a fivefold leap in first quarter earnings as surging orders and container prices offset higher iron ore cost.

China International Marine Containers Co. Ltd. (CIMC), an arm of ports-to-roads conglomerate China Merchants Holdings, reported 184.7 million yuan (US$22.32 million) in net profit for the January to March period in 2004.

"After initial calculations for the first quarter of 2005, the company expects net profit in the 2005 January-to-March period to rise about 400 percent year on year," CIMC said in a statement in the Shanghai Securities News.

"Our margins for the first quarter have not been much affected by the rise in steel prices, thanks to soaring container prices and abundant orders,�� an unidentified company executive was also quoted as saying by the newspaper.

Strong demand and soaring raw material costs have been pushing steel prices higher.

Baosteel, parent of Shanghai-listed Baoshan Iron and Steel Co., has raised its prices of major products by 10 percent for the second quarter of 2005 on top of an 11 percent jump in the first quarter, a move followed by other major makers such as Wuhan Iron and Steel and Angang New Steel.

"The first quarter used to be the slack season for the container manufacturing industry, but we had a relatively low base for 2004. Also, both our production and sales in the period this year are close to those of the busy season," the executive added.

CIMC, which has a 40 percent global market share, saw its Shenzhen-listed yuan-denominated A shares soar 78 percent in 2004, sharply outperforming a 15 percent drop in the market.

Source: Shenzhen Daily/Agencies