Container rates drop to unsustainable levels, Maersk CEO says

"Freight rates have fallen significantly since the good years of 2021 and 2022, and have fallen actually to an unsustainable level," Clerc said on Thursday. An influx of new container ships last year added 9% to the industry's global capacity, which is expected to increase by another 11% this year and a further 7% in 2025, the CEO added.

The global container shipping market faces overcapacity in the coming years and the rates paid by customers have fallen to an unsustainable level, Maersk CEO Vincent Clerc told the group's annual meeting of shareholders on Thursday.

Maersk last month warned

that container shipping overcapacity would hit profits this year, in contrast to the record earnings achieved in the wake of the pandemic. "Freight rates have fallen significantly since the good years of 2021 and 2022, and have fallen actually to an unsustainable level," Clerc said on Thursday.

An influx of new container ships last year added 9% to the industry's global capacity, which is expected to increase by another 11% this year and a further 7% in 2025, the CEO added. By contrast, Maersk's fleet has remained constant in size in the same period.

"Demand growth, slow-steaming, ship recycling will have to offset over time this overcapacity so that we can get back to a healthy earnings level," Clerc said.

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