Maersk ups full year earnings forecast as port congestion grows

The Danish shipping company has upped its full year 2024 EBIT forecast to $1 - $3 billion from negative $2 billion - $0 previously and its full year EBITDA forecast to $7 - $9 billion from $4 - $6 billion previously.

“On the back of continued strong container market demand and the disruption caused by the ongoing crisis in the Red Sea, AP Møller - Mærsk A/S (APMM) now also sees signs of further port congestions, especially in Asia and the Middle East, and additional increase in container freight rates,” the company said.

“This development is gradually building up and is expected to contribute to a stronger financial performance in the second half of 2024.”

The Shanghai Containerized Freight Index (SCFI) jumped 13% week-on-week on 31 May hitting 3,000 points its highest level since August 2022, when spot container freight rates were at unprecedented levels as result of pandemic induced disruption.

Congestion has hit the key transhipment hub of Singapore recently with analyst Linerlytica reporting last week that some container ships were facing berthing delays of up to seven days. The Singapore authorities say they are reactivating old berths in Keppel Terminal to increase capacity as well as accelerating new berths come onstream at Tuas Port.

Related:Singapore port reactivating mothballed berths to fight congestion

HSBC Global Research commented in its Global Freight Monitor on 3 June, “We think the situation is less likely to ease any time soon given the early peak season coinciding with capacity and box shortages due to the Red Sea disruptions."