'[This] will be a good year for the container shipping industry,' Mr Jia said yesterday, adding freight rates would increase 5 per cent to 6 per cent from last year.

The rapid growth of China's exports and imports has fuelled international trade. According to the Ministry of Commerce, mainland trade grew about 39 per cent to more than US$522.97 billion in the first six months of last year.

CSCL said cargo volume in trade between Asia and the US rose a comparative 36 per cent last year, while freight rates climbed 8.7 per cent. The route to Europe and the Middle East saw cargo volumes jump 57 per cent as freight rates rose 13.7 per cent, Mr Jia said.

The route to Australia last year reported the biggest increase in freight rates of 47.6 per cent, while cargo volume increased 11 per cent.

Mr Jia declined to specify how many vessels and containers his company would buy this year but said it would take delivery of 20 new vessels it ordered in 2001 and 2002. It would need to order 220,000 containers to fill the new ships.

As domestic trade delivered a margin of 35 per cent last year, up from 23 per cent a year earlier, CSCL will develop this segment of business.

Last month, the firm agreed to buy a 25-year-old vessel, with a capacity of 1,270 20-ft equivalent units, from its sister company for 71 million yuan. 'We'd like to use the ship on domestic coastal routes,' Mr Jia said.

CSCL said in its listing prospectus in June last year that it would inject 500 million yuan of its proceeds into Shanghai Puhai, its subsidiary which operates domestic feeder services.

However, Mr Jia said the contribution would be reduced to 200 million yuan, with the rest being spent on vessels and containers.