The forecast is that the contraction will be limited to only 2,5%
AP Moller Maersk, the world's second largest shipping and logistics company, warned on Friday that the contraction in global trade will be "longer and deeper" than the shipping company had predicted a few months ago.
The company has stated that companies around the world are already reducing their inventories due to the risks of a imminent recession in the main European markets and in the United States.
Maersk estimates that the drop in demand for maritime containers, a key indicator for the global economy, could reach up to 4% by the end of the year. At the beginning of the year, The forecast is that the contraction will be limited to only 2,5%. This is a strong contrast to the boom that the sector experienced between 2020 and 2022, when logistics companies were one of the main beneficiaries after the health crisis.
The Container volumes have fallen by 6,1% in the second quarter, according to data published today by the company. This seems to confirm the view of analysts, who have been warning since last year of the effects of the interruption in raw material flows from Russia to Europe. export blockages from China and the rapid commitment to deglobalization by large firms.
2023 looks to be a much more difficult year than expected as commercial customers try to reduce their inventory levels. At the same time, large firms such as Maersk and its rivals such as MSC or CMA absorb new ships ordered during the boom at the beginning of the decade.
In relation to the results of AP Moller – Maersk reports a better-than-expected second quarter of 2023, while continued market normalization continued during the quarter, leading to lower volumes and rates. Revenue stood at $13.000 billion compared to $21.700 billion in the second quarter of 2022, while profitability was strong, reaching 12,4%, although significantly lower compared to the extraordinarily strong second quarter 2022. Reflecting the strong performance in the first half of the year, Maersk raises financial outlook and now expects underlying EBITDA of $9.500 billion to $11.000 billion (previously $8.000 billion to $11.000 billion), underlying EBIT of $3.500 billion to $5.000 billion (previously $2.000 billion to $5.000 billion) despite a weakening market outlook for the second half of the year.
According to Vincent Clerc, CEO of Maersk: “The second-quarter result contributed to a strong first half of the year, where we responded to sharp changes in market conditions caused by inventory reductions and a moderate growth environment following years driven by the pandemic. Our decisive cost control actions, along with our contract portfolio, mitigated some of the effects of this market normalization. A focus on costs will continue to play a central role in managing a subdued market outlook that we expect to persist through the end of the year. As we advance this agenda, we remain committed to our transformation and continue to invest in and deliver truly integrated logistics solutions to our clients, amplifying your supply chain resilience for the uncertain times ahead. "
Financial guidance for 2023
The inventory correction observed since the fourth quarter of 2022 appears to be continuing and is now expected to last through the end of the year. Based on the ongoing inventory reduction, AP Moller – Maersk now forecasts global container volume growth in the range of -4% to -1%, compared to the previous range of -2.5% to +0.5%. Ocean expects growth to be in line with the market.
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