Maersk Line made a net loss of US$376 million in 2016, according to annual results released by the shipping line.

The result was significantly worse than that of 2015, in which Maersk Line made a profit of US$1.3 billion.

“We made a loss in 2016 due to a 19% decline in freight rates,” said Pierre Danet, CFO of Maersk Line. “This loss is clearly unsatisfactory. On the positive side, we won market share, we continue to drive costs down and we increased our utilization. We remain competitive. And we have a strategy that addresses the challenges in our industry. It will ensure that we continue to focus on customers, that we maintain our leadership position and that we again become profitable.”

The shipping line transported 20,830,000 TEUs in 2016, a year-on-year increase of 9.4%. The largest contributions were made by East-West backhaul, which grew 19%, and North-South headhaul, which grew 7.3%.

“Overall, container shipping demand grew below our expectations,” said Danet. “However, in the last half of 2016, we experienced better industry conditions than in the first half. First due to a better supply-demand situation, which resulted in an improvement in freight rates.”

At the end of the year, the fleet stood at 292 owned and 347 chartered vessels, with a total capacity of 3.24 million TEUs.

Maersk Line said that it is expecting global containerized shipping demand to grow by 2-4% in 2017.

“There are encouraging signs; however the market situation is still very challenging,” Danet said. “Rates and demand levels remain low. That is why we will continue to manage our capacity tightly.”

The delivery of nine 14,000 TEU vessels will be delayed by between one month and one year, with the last vessel to be delivered at the end of 2018, according to Maersk.