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Maersk halted spot bookings after the Suez Canal bloackage

Depending on the market dynamics, the company is expecting significant loss in capacity over the nest few weeks.

Container shipping giant, AP Moeller-Maersk recently announced to the media the halting of its spot bookings of chosen services in wake of the Suez Canal blockage in the recent past. The statement also said that the disruptions can be expected for ‘weeks to come.’’

The company pointed out that resuming its services after the incident would definitely have ripple effects on global supply chains for the next few weeks to come. The statement included the distress the company feels about this and that they are putting the full efforts to minimise the total impact on its customer’s supply chains.

The 20,000 TEU boxship, the Ever Given blocked the Suez Canal and created tension on the key checkpoint for the global shipping industry for the next six days. The waterways are the means of commute to several hundred vessels.

Maersk states that there are high chances for the capacity to drop up to 30 percent and the build-up of ships that had been waiting at the Suez Canal could trigger a capacity plunge into the coming weeks. The suspension of spot and short-term contracts will affect all the exports from Asia.

Earlier this month, the Danish shipping giant was considering the sale of refrigerated container businesses for $1 billion as the demand for cold storage units hikes during the Covid-19 pandemic. Maersk was also planning to reach out to suitors in the month of March and draw interest from shipping companies and private equity firms. The cooling containers are used for the transportation of fruits, vegetables and other food materials. With the lockdowns clogging the global supply chain routes, it has surged demand.

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