Major container shipping line posts big losses
A Maersk shipping container.
Steve Chiotakis: In Greece, outgoing Prime Minister George
Papandreou said an agreement's been reached on an interim government that will secure a new debt deal. Worries about the European debt crisis, along with the sluggish American economy, has brought global growth to a near standstill. That, of course, means fewer goods are being traded.
And this morning, the world's biggest container shipping line, Maersk, is posting losses of nearly $300 million for the past three months.
Reporter Christopher Werth has more from London.
Christopher Werth: Shipping -- that is the amount of stuff the world schlepps from port to port -- isn't just a good indicator of where the economy is now. It also tells us a lot about where we thought we'd be three years into recovery.
After demand fell off a cliff in 2009, shipping companies ordered a slew of new container ships, expecting growth to be moving along by now.
Instead, demand is nowhere near the level needed to keep up with the growing supply of cargo holds.
Over 200 new vessels have hit the water so far this year. Steve Matthews of the Lloyd's List shipping journal, says with all that competition, shippers have had to drop freight rates, which hurts their bottom lines.
Steve Matthews: Well, clearly there was a lot of over optimism as to economic growth. And the order book of new container ships is still very large. And so there'll be a lot more delivered next year as well.
He says that means the shipping industry can expect plunging profits to continue into next year and maybe beyond.
In London, I'm Christopher Werth for Marketplace.