Container demand has been slow in 2023. Do you believe volatility will continue into 2024?

This year is likely to remain very challenging for the shipping industry as we come out of an extremely volatile 2023, when the container markets saw a big decline, and are headed into 2024 on an even more tumultuous footing given the many variables beyond our control, from serious geopolitical issues like what we see in the Middle East or Houthi attacks on Red Sea merchant ships that are diverting us away from the Suez Canal. Such non-controllables impact not only how we re-route our vessels but also how we drive our business forward. This year started with extreme volatility, and we project continued - and concerning - headwinds ahead. 

Maersk has announced half a billion US$ in infrastructure investments in Southeast Asia. What motivated this?

Our investments are, in a sense, a response to marketplace volatility. Maersk is committed to building resilience and protecting our customers from the unpredictability in the supply chain by creating more country-specific logistics capacity. Moreover, Southeast Asia is one of the most dynamic and expanding regions, which makes this region ideal for long-term investments. Our investments in the region also support our cross-sector diversification strategy so as to avoid over-dependence on one or two verticals. Ultimately, Maersk has a strategic vision to be the global integrator of container logistics, and these investments in hubs, land facilities, or airfreight, fall under this vision. Besides our ocean shipping, we must be able to offer holistic solutions and build our multi-modal capabilities in a “one-stop shop” concept. 

Could you elaborate on the focus of your planned investments in the region?

One focus is on the ocean side, where Maersk is investing in terminals towards a new ocean network to be complete by 2025. For example, we are investing in upgrading the infrastructure at the Port of Tanjung Pelepas (TPP) in Malaysia, which is poised to become a key, integrated, and multi-modal logistics hub within Maersk’s new ocean network. 

The second focus is inland logistics where we are building mega distribution centers, such as TPP in Malaysia, the most recently announced World Gateway 2 in Singapore, and a Kuala Lumpur (KL) warehouse expected to be ready by 2025. By 2026, we expect to add almost 480,000 sqm of capacity between Malaysia, Indonesia, Singapore and the Philippines.

Maersk inaugurated the first methanol vessel in Europe. What kind of lower-carbon solutions is Maersk bringing to Southeast Asia?

Maersk has a goal to become net-zero by 2040. One of the first steps we have taken was to invest in green-methanol vessels. In February this year, we launched our first such ship, becoming a pioneer in the industry. Moreover, being a first-mover in this field also made us the enabler for the green maritime fuel value chain, with Singapore becoming the first port to pilot ship-to-ship green methanol bunkering for Laura Maersk, our first green methanol-powered vessel. 

 The next thing we did was to invest in the fuel source – the demand for green methanol will increase as more vessels are making the switch. Thirdly, on land, most of our existing warehouses have been retrofitted with solar panels, while all new facilities are designed to rely solely on solar, as part of our mandate. In terms of EVs, not all countries in Southeast Asia provide the same infrastructure maturity to make the switch on our fleet, but we continue to invest in electrification wherever possible where we are able to tap into the renewable/clean energy sources.

What opportunities do you identify in the chemical vertical?

Chemicals is our fastest growing vertical. Singapore’s energy and chemicals sector ranks among the top 10 globally and remains positioned for high growth. Maersk has opportunities to expand in both directions - the buy-and-sell upstream markets and the downstream supply of raw materials for manufacturers. 

Do you have a final message for our audience?

With a history of well over 100 years, Maersk will be well positioned to continue the integrator journey with investments in the right places. We will then be able provide maximum flexibility and adaptability, bringing resilience in our customer’s supply chain and delivering the value as an integrator. Our mission is to make life better for everyone.