A warning sign from the world’s biggest shipping line

(Dec 11): The world’s largest container shipping line says international freight rates are reversing after climbing for most of this year, raising questions about the sustainability of the global trade recovery.

Decade-old oversupply issues swamped demand for containerized sea trade in the third quarter, a senior official at Maersk Line. said in an interview last week. Over 90% of trade is routed through ships, making the industry a bellwether for the worldwide economy.

"We have started to see some pockets of downward pressure," said Steve Felder, Mumbai-based managing director of Maersk’s South Asian unit. The global trade order book at around 13.5% of capacity isn’t high, "however, given that freight rates are largely determined on the basis of supply-demand balance, they remain fragile," he said.

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