Danish shipping company Maersk is predicting an easing of supply chain issues towards the end of the year, after reporting an upgrade in its yearly profits forecast yesterday (2 August).

Maersk stated that a “normalisation” in the market would take longer than initially expected, according to the FT.

The shipping giant wrote in its interim Q2 report that supply chain congestion in Europe remained, as containers were staying in ports and warehouses longer than normal due to weakened demand.

It also stated that it is still uncertain when constraints on shipping – including landside bottlenecks in trucking and warehousing – will end.

Port congestion

Maersk CEO Soren Skou told Bloomberg TV that the issue of port congestion centred around a lack of logistics personnel.

He blamed the war in Ukraine for removing Ukrainian and Russian truck drivers from the European market.

“That's why we see some of the congestion we see in the ports,” he said. “It's very hard for us to get the containers out of the ports because of a lack of truck capacity, and congestion in the ports absorbs capacity. And that helps keeps freight rates very high.”

‘Infrastructure problem’

Bjorn Vang Jensen, vice president of advisory services at maritime consultancy Sea-Intelligence, and a former manager at Maersk, agreed with this sentiment on an interview on the BBC Today programme this morning (3 August).

“Fundamentally this is not a shipping issue, it never really was,” he said. “It’s an infrastructure problem that mainly occurs on the land side, primarily in the US but increasingly also in Europe.”

He pointed to the same congestion issues highlighted by Skou: “We’re seeing congestion outside the ports, so vessels can’t get in. Why? Because ports are struggling to get containers back out to the receivers.”

Important indicator

The Danish company is often seen as a key barometer for global trade, as it transports goods for major retailers and consumer companies, according to CNBC.

As reported by Business Insider, some analysts say there are signs supply chain pressures are easing, pointing to falling wait times for goods shipments.

Profits estimate

As covered previously by the IOE&IT Daily Update, Maersk, which handles around a sixth of the global container trade, upgraded its profits estimate for the second time this year, from $24 billion to $31 billion.

The “exceptional” market for transport companies, including high container shipping rates, will result in future profits, the company predicts, but this could gradually ease off towards the end of the year.