News / Maersk volumes surge as rates slump, hitting ocean, while air grows

© Vladimir Serebryanskiy

Strong volume growth in ocean, alongside sharply lower rates, points to a trade-off by Maersk that appeared to prioritise utilisation and network efficiency over margins. 

Maersk’s first-quarter performance saw ocean volumes up 9.3% year on year, to 3.2m teu, while vessels ran at 96% utilisation. But this came as average freight rates fell 14%, to $2,081 per 40ft, driving the division to an EBIT loss of $192m, compared with a $743m profit a year earlier. 

The combination – along with anecdotal evidence from forwarders – suggests Maersk has leaned into market share gains, particularly on the key east-west trades, where volume growth of 9.2% was driven by strong Asian exports. 

During today’s earnings call, chief executive Vincent Clerc acknowledged the imbalance, noting the quarter was marked by “strong volume growth… against… materially lower earnings in ocean driven by deteriorating rates as a result of industry oversupply”. 

In effect, the carrier is using its scale and network, including the Gemini Cooperation, to optimise asset utilisation and reduce unit costs, at the expense of near-term margins. 

Mr Clerc explained that Maersk had delivered “a six percentage point overperformance on volume growth versus fleet growth… allowing us to increase our asset turn and bring down our unit cost”. 

Group revenue fell 2.6%, to $13bn, while EBIT dropped sharply, to $340m, from $1.25bn, largely reflecting the downturn in ocean profitability. 

While the outbreak of the Middle East conflict late in the quarter has driven disruption across global supply chains, Maersk said the financial impact on Q1 had been limited due to timing effects, with higher costs and rates yet to be fully recognised in earnings. 

However, the carrier indicated the impact would become more visible from the second quarter, as higher fuel costs and longer routing patterns begin to flow through the P&L. 

Maersk’s Logistics & Services division, which includes forwarding, continued to deliver steady growth and improving margins. 

Revenue rose 8.7%, to $3.8bn, while EBIT increased 22%, to $173m, lifting margins to 4.6% and marking the eighth consecutive quarter of year-on-year margin improvement. 

Forwarding-related activities were a key contributor, with “Transported by Maersk” revenue up 10%, and first-mile volumes up 9.3%, while air freight volumes surged 20% year on year, to 82,000 tonnes. 

The growth in air cargo reflects continued strength in high-value and time-sensitive flows, particularly from Asia, alongside demand linked to AI-related goods, but Maersk noted transatlantic charter activity was its key driver. 

Mr Clerc said the division was “growing, and… growing profitably”, adding that improvements were “especially [in] air freight and middle-mile, with higher year-on-year margins in both”. 

Maersk said margin gains were driven by productivity improvements, tighter revenue management, and a more favourable product mix, particularly in air and middle-mile services, underlining its push to build a more resilient earnings base, beyond ocean freight. 

The wider air freight market was estimated to have grown between 3.5% and 5.5% year on year in Q1, again driven by exports from Asia, it said. 

However, rates remained under pressure, averaging $2.10/kg, down 1.5% year on year, although they strengthened towards the end of March. 

While lower bunker costs helped offset some of the rate pressure in Q1, Maersk indicated that this dynamic was reversing, with fuel costs rising sharply towards the end of the quarter. 

Q1 bunker costs were down 15% YoY, with price down 16% and consumption down 5.3%. The group said energy market disruption, including tighter bunker availability and rising oil prices, was already increasing cost pressures, with the full impact expected to be felt in coming quarters. 

The outlook remains finely balanced: while demand has so far been resilient, supported by strong Asian exports, Maersk warned that the combination of industry overcapacity and rising cost pressures could weigh on profitability if market conditions softened later in the year.