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Maersk CEO says U.S. freight demand shows no signs of fading | Real Time Headlines

Maersk CEO: We expect disruption in the Red Sea until at least the end of the year

shipping giant MaerskThe company, seen as a barometer of global trade, is seeing no signs of a U.S. recession because demand for freight remains strong, its chief executive said on Wednesday.

“Realistically, all of the concerns about a recession that we’ve seen in the (container) market over the past few years remain intact,” Vincent Clerc told CNBC’s “Squawk Box Europe” on Wednesday. Amazingly resilient,” he said, adding that container demand is often a good indicator of underlying macroeconomic strength.

Clair said U.S. inventories – goods stored before delivery or processing – are “higher than at the beginning of the year, but not at levels that are worrisome or appear to indicate an imminent significant economic slowdown.” There is some unpredictability in the quantities.

“We’ve also looked at purchase orders from many retailers and consumer brands that need to be imported into the U.S. to meet demand for the next month, and they still appear to be quite strong… at least according to our data and indicators. ” This seems to indicate that people still have a certain degree of confidence that the current level of consumption in the United States will continue. “

Concerns about a recession in the United States, the world’s largest economy, suddenly escalated last week after a series of events. Weaker than expected Employment data is divided economists and market participants.

According to the latest data released by the U.S. Census Bureau, U.S. retail trade inventories (a measure of unnecessary increases) increased by 5.33% year-on-year in May to $793.86 billion.

A report released on Wednesday by leasing platform Container xChange said indicators show inventories are higher than demand, meaning the coming months will be less of a “boom period” for container traders, logistics markets and retailers hoarding inventory. Prosperity”.

Maersk’s Clerk said the company has been surprised by the recovery in container throughput over the past few years and said it expects this to continue in the coming quarters – with no signs that the global economy is heading for a recession.

He went on to say that Chinese exports have been a strong engine for container traffic as the global share of containers originating from or destined for China increases.

The outlook for the Danish company looks decidedly bleaker in 2022, warn Inflation is weighing on demand, the threat of a global recession, the European energy crisis and the war in Ukraine.

The combination of these factors will lead to lower freight rates in 2023, leading to Maersk’s Profits plummet.

That trend has been partially reversed this year as geopolitical tensions intensified in the Red Sea, causing shipping lines to reroute trade around Africa’s southern coast, lengthening sailing times and draining capacity from the global system.

How Red Sea attacks affect global supply chains

Red Sea will lead to further inflation

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