Maersk container shipping market weakness issued a profit warning

In the world's largest container shipping company, the unit is now expected to be $1 billion 600 million in annual revenue, compared with the previous forecast of nearly 40%, the main reason is that China's economic slowdown and weak demand for Global trade led to the decrease in Global trade demand.

The Danish shipping giant Maersk cut its full year profit forecast, said global demand for the container shipping has been weaker than expected, this is another sign of the weak global container shipping industry, market watchers blame in European demand decline and economic slowdown in China and the exchange rate depreciation leads to a decrease in the demand for luxury goods and other imports.

Maersk third quarter net profit dropped by nearly half

According to "the Wall Street Journal reports, the Danish shipping giant Maersk Group on October 23, cut the annual income prediction, said the group's global demand of container shipping has been weaker than expected, and shipping containers to the group is also the largest source of profit.

The company said that based on the flag of Maersk shipping company Maersk Line of weaker than expected performance, is expected this year, the basic income is $34 billion, instead of the previous 40 billion dollars. Maersk Line is calculated by volume in the world largest container shipping company, the unit is now expected annual income is $16 billion, lower than earlier than forecast of $22 billion.

Ma Shiji said its third quarter net profit was $, almost half of the same period last year.

Global container shipping industry suffered heavy losses

The profit warning is the latest in a series of terrible forecasts for the global container shipping industry.

In the past three years, the world's top 20 container operators are trying to consolidate and form a large coalition, in order to cut costs.

The global economic crisis in the global trade and shipping industry weakened, exposed massive overcapacity. Container operators have also spent billions of dollars on giant container ships, making it cheaper and more effective when loaded with goods, and this has also increased the capacity of the world fleet.

Analysts estimate that, in some of the busiest ocean trade routes, the shipping industry's capacity is 30% higher than its demand. Container ship carrying more than 95% of the world's manufactured goods.

"Only this year, the new ship will increase capacity 8.2%, or 1 million 700 thousand containers, and the demand can only grow at a maximum of 2%, the lowest level since 2009," said Jonathan Roach, a Roach Shipbroking ACM, a London based Broker's Firm. This is a serious situation for container shipping, and will not change in the short term."

Container shipping prices also fell to the bottom

Weak economic growth in China and the euro zone has also pushed the price level to barely pay for fuel. In Asia to Europe's main trade link, the average price of each container is hovering at $300, far less than that of the shipping business.

Usually before the end of the holiday season, retailers will hoard clothing, electronics, home appliances and toys, etc., but this year has not been seen as a result of the increase in the volume of gifts. Market watchers blamed the decline in demand in Europe and the slowdown in China's economic slowdown in luxury goods and other imports. London and Singapore's shipping brokers said the devaluation of the renminbi in August had a profound impact on the European luxury goods shipments.

"Since the devaluation of the renminbi, we have seen a decline in shipments of luxury goods such as handbags, designer clothes, shoes and so on. 18%." A broker said.

Overseas Container Lines (Orient) is one of the largest container carriers in Asia. The company said 23, due to the decline in shipping prices, Asia to Europe routes of revenue in the third quarter fell by 32.2% compared with the previous year. The company's total revenue in the third quarter fell by 1 billion 300 million to $12.2%.

Maersk CEO Nils? Nils Andersen, Anderson said, compared with the same period last year, per 40 foot container in the average price of all ocean routes in the third quarter fell more than $500.

"Therefore, we have seen a significant decline in tariffs, the current market price situation is very challenging for everyone." Mr. Anderson said in a conference call.

"The only surprising thing is a profit warning did not come earlier," and operational headquarters in Copenhagen shipping consultancy company SeaIntelligence consulting Lars? Jensen, Lars Jensen said. "This will is industry wide problem this year."

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