Yesterday’s “Gulf Times” carried the following report, with the following headline:

“Maersk, top rivals to share carriers”

“COPENHAGEN: AP Moeller-Maersk’s container shipping line, the world’s largest, will begin sharing vessels with its two biggest rivals on some North American routes as slowing US economic growth reduces shipments. Maersk Line will share three routes between Asia and North America with Mediterranean Shipping Co. and CMA CGM starting in April, the Copenhagen-based company said. Each partner will provide most of the ships on a route, with the other companies allowed to book space on the vessels…”

“‘This deal illustrates just how much pressure the container lines are under for the American routes, as they also are hurt by higher fuel costs,’ said Jacob Pederson, an analyst at Aabenraa, Denmark-based Sydbank A/S … ‘It’s not normal for market-leader Maersk to enter such agreements, so this shows how far they are willing to go,’ he added.

“The company, which owns 500 vessels that carry 1.7mn containers, is implementing the biggest cost-saving plan in its 103-year history after the shipping unit posted a 2006 loss stemming from a drop in the rates charged for carrying cargo.”

“It’s not normal…” is what the man said. Think about that. Only a few years ago, these giant carriers were transporting about the same amount of cargo they’re having trouble with today. The problem, of course, is that carriers have far too much capacity … they’ve built too many vessels. Too many very large vessels … vessels that cost a lot more than smaller vessels would have cost, we might add.

They were transporting this cargo efficiently and at a handsome profit, and they didn’t hesitate to show those profits in their financial reports. So now what’s the real reason these carriers require vessel sharing agreements in order to avoid the kind of loss that Maersk posted in 2006. Rising fuel costs? Baloney. The cost of fuel has been rising steadily since the crisis we had in 1973 and 1974.

Like we just said, they’ve built too many mega-ships. Had they stuck with container ships of moderate sizes they’d have no trouble filling those vessels with today’s consigned cargo. Instead they’re forced to eat crow, swallow their pride, and with hat in hand and their tails between their legs, they’ve run to each other for a bale out.

They heard, but didn’t heed the warnings from Jon Helmick, Don Cameron, Jim Reese, James Hartung, Nolan Gimpel, Neil Davidson, the editors of the FINANCIAL TIMES, Katherine Yung, Park Jung Wong, Jee Heon Seok and a host of others. But so what if difficulties were encountered along the way. They’d simply offset their losses by increasing prices to the gullible U.S. consumer.

What they didn’t anticipate, however, was a recession brought on by the flock’s very own shepherds.