The slowdowns in GDP reported in the UK, the United States and the Eurozone in recent days give an idea of the economic impact COVID-19 is having.
As important, in piecing together a picture of what is happening to economic activity on the ground, are some of the trading updates released by individual companies.
And few companies can provide as good a picture as AP Moller Maersk, the world’s biggest container shipping company, which today updated investors on recent trading.
It was not encouraging.
Denmark’s fifth-largest company, regarded as a bellwether for global trade, said that nearly 10% of its fleet was currently lying idle – the highest rate since the financial crisis more than a decade ago.
It said that it had cancelled more than 90 sailings, or 3.5% of its total shipping capacity, during the first three months of the year.
It said there were likely to be as many as 140 ‘blanked’ sailings – where a freight operator cancels a vessel’s call at a particular port, or region, or even an entire leg of the journey – during the current quarter.
Soren Skou, the chief executive, told CNBC: “Our expectation is that we will see demand significantly down in the second quarter, maybe as much as 20% to 25%.
“But we will also match that on a one-to-one basis with reductions in capacity. It helps continue to serve the customers but also to take out a lot of costs and keep our [freight rate] pricing stable.”
AP Moller Maersk, which is estimated to transport around one in five containers around the world, said that, during the first three months of the year, global container trade fell by 4.7% as the COVID-19 pandemic began to hit supply and demand.
This was due mainly to a marked downturn in East-West trade as China succumbed to coronavirus early in the year.
European imports from China were down by 16% during the period, with Chinese exports almost coming to a halt in February, with European demand falling in March as it too was struck by the virus.
Container imports into North America during the quarter were also down by 7.8%. Falling retail sales and car production in both Europe and the US were particularly to blame for the weaker container demand.
Further out, the company said, demand for containers was expected to weaken further during the current quarter but insisted it was impossible to be more precise.
It added: “While the outlook is very uncertain, it is expected that container demand will decline in 2020 compared to 2019.
“At present, it is difficult to predict the timing and the shape of the recovery in global trade volumes with confidence, as it will be determined by the interplay between the path of the virus and government policies in relation to the economy.
“As a reference point, the World Trade Organisation projects global merchandised trade to decline by between 13-32% in 2020.”
It said the collapse in oil prices would also hurt demand from a number of oil-producing countries in Latin America, Africa and the Middle East.
Complicating matters has been the fact that, while some retailers that have had to close their stores due to the lockdown have been asking the company to delay shipments, others – most notably Amazon – had been increasing their volumes and had been asking for faster deliveries of goods.
The downbeat outlook from AP Moller Maersk, which employs 80,000 people in 130 countries around the world, will raise concerns about the health of global trade.
Before the first quarter of this year, there had been only two quarters going back all the way to 2012 during which demand for containers had fallen, but on both occasions it was nothing like the 4.7% contraction seen this year.
One of those quarters, though, was for the final three months of last year – highlighting the extent to which the trade war between the US and China had already started to bite.
The challenge for the shipping industry is how it responds to the crisis.
Mr Skou’s comments suggest it has learned its lessons from the downturn in global trade which followed the financial crisis.
Then, shipping companies engaged in an all-out price war, slashing their rates to a level where they barely covered the cost of fuel. The industry suffered devastating losses as a result.
The container shipping industry globally lost an estimated $23bn in 2009 alone and a number of operators, including Shandong Yantai International Marine Shipping and Europe West indies Lines, went bust. Others like Hapag-Lloyd of Germany, one of the biggest players in the industry, had to seek a bail-out by its shareholders.
The response this time around, with more ‘blanked’ sailings, suggests the industry is taking a more disciplined approach to protect rates and position itself for a possible recovery later this year.
Yet this will require a disciplined approach from the entire industry. The recent history of oil production is a good guide to what can happen to prices when one major producer breaks ranks with others.