NOT ENOUGH SHIPS AVAILABLE IN THE WORLD TO MEET A SURGE IN CONSUMER DEMAND

2021-08-05

Denmarks Maersk said on Wednesday it expected its "exceptionally strong" performance in the first quarter to continue for the rest of the year, driven by high demand for shipping containers from China to the United States. Maersk, which handles about one in five containers shipped worldwide, said there were not enough ships available in the world to meet a surge in consumer demand, resulting in record-high freight rates.

The firms shares traded 4% higher at 0921 GMT, near a record high reached last week. "The situation today is that our customers are trying to meet a very, very high underlying demand, while at the same time rebuilding stock," Chief Executive Soren Skou told a media call.
NOT ENOUGH SHIPS AVAILABLE IN THE WORLD TO MEET A SURGE IN CONSUMER DEMAND
Large retailers and producers, have said congestion at ports, container shortages and delays at the Suez Canal were causing problems in shipping products made in Asia to key markets.

Imports into North American from Asia rose 40% in the first three months of the year. Container ships are now waiting 16 days outside the port in Los Angeles to unload, Skou said.

Skou said he expected bottlenecks in the Suez Canal, where Maersk at one point had 50 container ships waiting to pass, to be cleared by next month. Maersk last week raised its outlook for full-year underlying earnings before interest, tax, depreciation and amortisation (EBITDA) to $13 billion-$15 billion from $8.5 billion-$10.5 billion.

It lifted its forecast for global container demand growth to 5%-7% from 3%-5%. Container demand contracted 1.8% last year.

Vía: Reuters by Jacob Gronholt-pedersen