During its quarterly earnings call, AP Moller-Maersk warned the US-China trade war could limit growth in global container traffic to the lower end of a 1%-3% guidance range this year
The company saw growth of around 2% between April and June. However current and planned tariffs could cut global container demand by 1% according to CEO Søren Skou.
"If it all were to be implemented, we estimate it could reduce global trade growth by up to 1% at this point for the next year. And, as the IMF has pointed out, further escalation could cause the global economy to slow further and that of course will be negative for us," he said.
Reporting a Q2 2019 net profit of US$141M – up from the US$2M net loss Maersk posted in Q2 2018 – Mr Skou said the impact from tariffs and trade tensions had been ’quite manageable’ for the company.
Noting a 0.5% revenue growth overall, higher volumes and higher average freight rates for its shipping interests, Mr Skou discussed the insulation the company had seen from rising trade tensions as a company whose highest exposure was European trade.
A confident American consumer had also mitigated the impact, he said.
"The most important probably is that the consumer spending is what drives demand in our industry and consumer spending remains fairly robust in the US supported by good labour markets and high consumer confidence."
Mr Skou said Chinese exporters and US importers had absorbed costs through lower margins and cited anecdotal evidence that tariffs were being circumvented by China shipping goods through proxy states in Asia.