Maersk cuts demand forecast as it warns of 'dark clouds ahead'

Container shipping giant Maersk has cut demand forecasts and warned of a slowdown in the face of a looming recession, despite beating third-quarter earnings expectations.

The Copenhagen-based freight company on Wednesday said it expected global container demand to fall by 2-4% this year against a prior guidance range of a 1% decline to 1% growth.

"It is clear that freight rates have peaked and started to normalise during the quarter, driven by both decreasing demand and easing of supply chain congestion," said chief executive Soeren Skou.

"With the war in Ukraine, an energy crisis in Europe, high inflation, and a looming global recession there are plenty of dark clouds on the horizon."

The shipping industry enjoyed bumper profits during the Covid pandemic as freight rates surged on the back of soaring consumer demand. Supply chain disruption also caused container scarcity, pushing prices up even more.

Maersk's earnings before interest, taxation, depreciation and amortisation (EBITDA) rose to $10.86bn in the June-September quarter from $6.94bn a year ago and above the $9.78bn consensus estimates compiled by the company.

Revenues were up 37% to $22.77bn, although the number of containers it loaded on to ships fell by 7.6% compared with a year earlier.

Reporting by Frank Prenesti for Sharecast.com