‘Very, Very Strong’ Demand Fuels Global Trade Amid Supply Shocks

(Bloomberg) — Three workhorses of global goods trade indicated demand remains solid as the artificial intelligence boom and energy transition help the world economy absorb shocks stemming from extreme weather, wars and tariffs.

A.P. Moller-Maersk A/S, the world’s second-biggest container carrier, raised its full-year outlook for the second time in seven weeks, crediting higher freight rates and a “more resilient global economy than initially feared.”

Hapag-Lloyd AG, the No. 5 container line, cited “strong exports out of Asia and improved US demand, which helped offset the significant cost headwinds” of about $600 million last quarter tied to the Mideast conflict.

DP World, the Dubai-based port operator and logistics giant, also released results Thursday, disclosing increased revenue and higher container volumes in the first half. The gains came despite a sharp drop in ship arrivals at Jebel Ali, its flagship port and industrial zone on the Persian Gulf.

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The announcements underscore the durability of consumer and corporate demand even as a war rages between Russia and Ukraine, and the US and Iran jockey for control of the Strait of Hormuz. Those conflicts are helping keep energy costs elevated.

Meanwhile, droughts are parching inland waterways from North America’s St. Lawrence Seaway to the Rhine and Danube rivers across Europe. Vessel bottlenecks are building at Chinese ports and queues are lengthening to transit the vital Panama Canal.

Maersk Chief Executive Officer Vincent Clerc said it’s an environment where freight rates will remain volatile.

“The underlying current is very, very strong, resilient demand for container transport on the back of electrification — whether it is generation, storage, new products such as electric vehicles, data centers, cooling,” Clerc told Bloomberg Television. “Anything that has to do with that is growing; the fabric of what we’re moving is changing and the volumes are growing very fast.”

In a separate interview Thursday, Jan Rindbo, CEO at D/S Norden A/S, one of the largest commodity shipping companies, agreed that demand is strong.

“And it’s broad-based,” he said. “We’re seeing it in grain, iron ore and steel, and increasingly in project cargo such as batteries and wind turbine blades.”