Maersk CEO: Imports to the US will drop
- "We expect that trade imports to the U.S. will drop a little bit in the coming quarters," Maersk CEO Søren Skou told Bloomberg in an interview at the World Economic Forum annual meeting in Davos, Switzerland.
- This outlook is in line with projections from the National Retail Federation (NRF), which said record import numbers at the end of 2018 were the result of businesses rushing to beat tariffs.
- Maersk also expects little impact on its company if there is a no-deal Brexit because it doesn't do much business transporting goods between the U.K. and mainland Europe. Much of this is done by another Danish company, DFDS, Skou said.
The downturn in imports headed for the U.S. has yet to be seen in the numbers for January due to shippers moving large volumes of goods in preparation for Chinese New Year, Skou said. Many factories in China shut down every year to allow their workers to celebrate the holiday, which falls on Feb. 5 this year.
But he expects a downturn in the coming months: "At some point that will be seen in the numbers," Skou told Bloomberg.
NRF's projections, released earlier this month, forecast 1.75 million TEUs to be imported for January and 1.67 million TEUs in February. This is down from 1.81 million TEUs in November and an estimated 1.79 million in December.
The trade war between China and the U.S. helped spur these high numbers at the end of the year as companies wanted to import goods before higher tariffs were in place.
The World Trade Organization (WTO) reportedly plans to investigate the tariffs the U.S. has imposed on $250 billion worth of Chinese goods to determine whether the U.S. has neglected to abide by the rule that WTO members must levy tariffs equally among other members, according to The Straits Times.
Across the Atlantic, the potential for a no-deal Brexit has raised concerns of what kind of impact this could have on trade between the U.K. and the European Union.
But one company that's apparently not worried is Maersk, which doesn't expect to have container ships piled up in the English Channel waiting for entry into the country, Skou said, noting that Maersk may feel the ripple effects of a hard Brexit indirectly.
"Our business will be impacted by the general impact on the U.K. economy," he told Bloomberg.
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