The world’s largest shipping company says a global trade war has just begun

Ships carry 90% of internationally traded goods.
Ships carry 90% of internationally traded goods.
Image: AP Photo/Arnulfo Franco
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AP Moller-Maersk, the world’s largest container-shipping company, spies storm clouds up ahead.

In an earnings call today (Feb. 21), CEO Soren Skou forecast trouble for the company in the months to come. A trade war is afoot—and it’s only just getting started, he said (paywall): “Even if China and the US settle their differences and do a trade deal, that’s not the end of trade tensions—that means the US moves its attention more on to Europe and we have another round there.”

That’s without even beginning to think of the consequences of an increasingly likely no-deal Brexit.

The company’s earnings have already been affected by these tensions. Skou said it expects a further cut to profits in the months to come, sending Maersk’s share price tumbling by 10%.

It isn’t just the trade war that should worry investors. “We see clearly a global economic growth that is declining,” Skou said, noting particular weaknesses in China and Europe.

He expects container demand growth to slow to between 1% and 3% this year, down from nearly 4% last year. (In the low-margin world of shipping, that is a significant decline.) CFO Carolina Dybeck Happe put it even more bluntly: “We have China slowdown. We have Brexit. Hard or not, we have the weaker economic outlook.”

Short of the arrival of the kraken, it’s hard to imagine worse news for a shipping company—or global trade more generally.

Correction: An earlier version of this story misstated the container growth expected by Maersk for 2019.