Maersk follows the money

You could see this one coming: A.P Moller-Maersk's chief executive was quoted as telling a Danish newspaper that the company will concentrate future investments on oil and terminals, not container shipping.

Andersen explained that oil and terminals are solidly profitable but that shipping is "a complex area to make money in." In other words, it's a lot of headaches for uncertain returns.

Maersk Line remains the world's largest container ship operator, still well ahead of expansion-minded Mediterranean Shipping Co., and Andersen's statement doesn't mean Maersk is abandoning the shipping business. However, given the choices, Maersk's decision to concentrate the bulk of its future expansion in other areas makes sense.

Maersk is fortunate to have businesses that can pick up the slack from container shipping, an industry whose capacity has gotten out of sync with market demand. Not all of the company's competitors are as well diversified, however, and one has to wonder when some of them will decide that shipping's risks have gotten too far out of balance with its rewards.

Supply and demand of container ship capacity will eventually get back into balance -- it's hard to believe that just five years ago, the JoC was reporting that Maersk and other carriers were struggling to find enough ships to charter. But market recovery for container shipping appears to be a few years off. Until then, you can't blame Maersk or other carriers for investing where they have a better chance of a profit.