Maersk shares jump as US port strike looms, boosting rates
AP Moller-Maersk A/S shares jumped as much as 4.9%, extending recent gains on expectations that labor talks with US port workers will fail and spark a new round of supply-line disruptions that would boost freight rates, BNN Bloomberg reported.
The transport giant on Tuesday decided to add a local port disruption surcharge for all cargo moving to and from the US east coast and Gulf coast terminals, to cover higher costs from “potential labor disruptions.” The US dockworker labor union and the shipping industry group face an Oct. 1 deadline to reach a new wage deal after talks have stalemated for months.
For Maersk and other container lines, a strike would add to a string of global trade disruptions in recent years, including the Covid-19 pandemic and attacks on ships in the Red Sea, which have boosted the freight rates they can charge their customers. Maersk has said that even a one-week US strike could have a large ripple-effect impact on supply chains, causing four-to-six weeks of disruptions.
Some 45,000 dockworkers at every major eastern and Gulf coast port are threatening to strike. The trade gateways involved handle more than half of all goods shipped in containers to and from the US.
“The consequences will be severe,” Peter Sand, chief shipping analyst at Xeneta, said in a Tuesday note on the possibility of a strike. There are already ships carrying “billions of dollars of cargo” on the sea heading for the US and “these ships can’t turn back and they can’t realistically re-route to the US west coast,” he said.
Maersk shares traded 3.6% higher as of 10:52 a.m. in Copenhagen and are now up almost 20% in the two weeks through Tuesday.
