UBS(US:UBS)2025-12-01 00:49Summary of Key Points from the Conference Call Industry Overview - Industry: China Industrials - Focus: Trade flows amid changing US tariffs on China, covering shipping, shipbuilding, ports, international freight flights, and land transportation [2][3][4]. Core Insights and Arguments - Container Throughput: Container throughput at key ports in China increased by 5% week-over-week (WoW) and 13% year-over-year (YoY) last week, indicating strong port activity [3][6]. - Port of Los Angeles: Import volume estimates indicated a decrease of 6% WoW but a growth of 4% YoY for week 49, following a significant 17% YoY increase in week 48 [3][10]. - International Freight Flights: The number of international freight flights rose by 13% YoY last week, compared to a 10% YoY increase in week 46, suggesting a recovery in air freight capacity [3][34]. - Freight Rates: The China-US freight rate dropped WoW, with the overall Shanghai Containerized Freight Index (SCFI) falling by 4% WoW and 35% YoY, indicating a softening in freight costs [4][12]. - Charter Market Activity: The containership timecharter market remained active, with operators competing aggressively for tonnage in the 1,700-4,200 TEU range, and charter rates holding firm at high levels outside the COVID period [4][12]. - European Port Congestion: A nationwide general strike in Italy is expected to disrupt the freight sector, with the average vessel waiting time at the Port of Rotterdam around 1.96 days [5][30]. Additional Important Insights - Railway Express Volumes: Outbound volume of the China-Europe/China-Asia Railway Express recorded a decrease of 7% YoY for China-Europe and an increase of 21% YoY for China-Asia in October [3][25]. - Asia Feeder Ship Availability: The Asia feeder ship availability index decreased by 6% WoW, indicating tighter capacity in the feeder market [4][32]. - China Expressway Truck Traffic: Truck traffic on expressways in China increased by 2% YoY last week, reflecting a slight uptick in domestic logistics activity [29]. - Direct Shipping Volumes: Direct shipping volume from China to ASEAN/US decreased by 10% WoW but showed a 1% YoY increase last week [20][22]. Risks and Considerations - Macroeconomic Risks: Investment downsizing at the macroeconomic level remains a key risk for China's industrial sector, with potential impacts on demand for industrial goods and import/export volumes [42].