Maersk CEO: Rates to Rise as Box Sector Cuts Capacity

A.P. Moller-Maersk on Wednesday disappointed investors with a third-quarter loss for its container business but Chief Executive Soren Skou said he expects freight rates to rise as the industry tackles overcapacity.

* Maersk Line posted a net loss of $116 million against analysts' expectations of a $174 million profit.

* "Consolidation will in itself not affect the overcapacity, but I notice that companies have stopped ordering ships," Skou said at a conference call.

* "In addition, the idled capacity has increased to 6-7 percent of the global fleet, while scrapping has risen sharply with ships with an average age of 20 years being scrapped. So there is action being taken in the industry to bring down the overcapacity," Skou said.

* Contract negotiations for next year's rates on the Asia-Europe route will begin at a higher level than the previous year, he said.

* "Since the second quarter 2016, spot rates have started to rise on a number of routes, and that trend will begin to positively impact Maersk in the coming months," Skou said.

* A.P. Moller-Maersk shares were down 9.2 percent at 9,190 Danish crowns at 1135 GMT. (Reporting by Jacob Gronholt-Pedersen