The SCFI rebounded by 0.8% last week but is unlikely to hold on to these gains with freight rates coming under pressure on both the Asia-Europe and Transpacific routes. Carriers failed to push ahead with the planned 15 August transpacific rate hikes and allowed rates to the US West Coast to slip with the lower rates to show up on the coming week’s SCFI reading. Carriers will be making another push for a September rate hike but conviction is low with capacity utilisation rates slipping across most of the main routes.
Despite the recent rate correction, carrier earnings will continue to rebound strongly in the 3rd quarter with rates remaining elevated across all key routes. 2Q earnings reveal a sharp divergence in performance between carriers with Asian carriers clearly out-performing their European peers with Maersk firmly stuck at the bottom as it continues to lag behind its rivals.
Linerlytica
Maersk remains worst performing carrier for the 3rd consecutive quarter
Maersk continues to underperform the rest of the market with the lowest EBIT earnings margins in the 2nd quarter of 2024 compared to all of its main publicly listed peers. Maersk’s Ocean shipping segment recorded EBIT margins of just 5.6% for the quarter compared to an average margin of 21.3% posted by 8 of its main rivals with only COSCO and OOCL yet to report their earnings figures. It marks the 3rd consecutive quarter that Maersk was placed at the bottom of the earnings league table, with its earnings consistently lagging behind its peers since 2020. A change in its logistics-heavy strategy now appears inevitable as it tries to regain lost ground on its liner rivals, marking yet another U-turn for the Danish carrier.
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