Maersk expects flat demand in early 2015

Maersk Line is hesitantly positive about 2015 trade volumes after a year in which import volumes declined dramatically and exports were hard hit by strikes. Speaking at the release of its interim third quarter results last week, Matt Conroy, Maersk Line’s South Africa trade and marketing manager, said hopes were high for increased container movements into and out of South Africa in the coming months. “Container movements declined as economic growth in the country slowed to under 1%,” said Conroy. “Whilst the official figures for the fourth quarter are not yet available we are expecting a marginal improvement. We hope to see some growth in the last few months of the year – but we are still unsure about fully rebounding in 2015. There are still question marks over how much growth can be expected in the coming months.” Conroy said there were indications that demand in South Africa would be fairly flat in the first half of 2015, increasing moderately towards the end of 2016. Maersk saw an overall volume decline of around 3% in the third quarter. “Container imports into South Africa have continued to decline, with the overall market for the year down by around 7%. We have seen a decrease especially on the Asia trade – and considering that around 50% of the imports into South Africa are from the East it is understandable that it has impacted significantly,” he said. Whilst the reverse would be expected for exports, the picture was not any better, with the first half of the year seeing volumes hit hard by ongoing strikes in various sectors in the country. “The mining strike as well as China’s reduced appetite for commodities contributed to the decline,” said Conroy. “Reefer volumes are down by around 4% thanks to the grape season not being optimal. Crop damage because of weather had a major role to play while the third quarter in particular was affected by lower citrus volumes as a result of the ongoing issue around Citrus Black Spot and the European Union.” With GDP growth only around 0.6% in the second quarter, and the five month long strike in the platinum sector, Conroy said there was no surprise for the line in the declining volumes. “Our strategy moving forward is therefore to put into place as many operational efficiencies as possible in an effort to keep costs down,” he said. INSERT 3% The overall volume decline recorded by Maersk in the third quarter. INSERT & CAPTION The mining strike as well as China’s reduced appetite for commodities contributed to the decline. – Matt Conroy