ROLF Habben Jansen’s usual cautious optimism has been clouded by uncertainties concerning the spread of the coronavirus.

The Hapag-Lloyd chief executive said 2020 now had an “extraordinary amount of uncertainty” around it.

“This whole situation right now will have an impact on the business,” he told Lloyd’s List in Long Beach. “It is difficult to estimate at this time whether that is going to be an impact for one or two quarters of the year or whether it will be something that will have structural effects.

“I’m not overly optimistic about 2020, but that’s more from the uncertainty than anything else.”

Nevertheless, he maintains that the fundamentals in the market are “okay”.

“I think it is still likely there will be a recovery when things pick up again because inventories have been depleted pretty much everywhere, so there will have to be some kind of restocking,” he said. “I think it is going to take some time before volume really picks up, but I would still expect to see an extended period of recovery.”

That recovery could come as soon as the end of the first quarter of the year, or beginning of the second quarter, as supply starts flowing again. But blanked sailings would remain a feature throughout March and April.

He is less certain, however, about the outlook for demand if coronavirus continues to spread among developed markets, as many fear may happen.

This week the Organisation for Economic Co-operation and Development reduced its global growth forecast from 2.9% to 2.4%, and the US Federal Reserve lowered interest rates to support the economy, indicating businesses could face pressure.

“Everyone speculates about it, and of course it will have an effect on economic growth,” said Mr Habben Jansen.

“How much of that will be temporary and how much will be structural, I do not know. Everything we have seen so far indicates that there is going to be some type of short-term slowdown, but it is difficult to say how long the effects of that will last.”

Nevertheless, he believes that Hapag-Lloyd, the world’s fifth-largest container carrier by capacity, is in a good position to withstand any downturn.

“We’ve always had a fairly conservative financial policy and that is why for the past two years we have said we would bring down our debt,” he said. “That means that today our balance sheet is strong. That is very comforting in a situation like today. If your balance sheet is more strained, you more quickly get into all sorts of difficulties that you would like to avoid.”

Hapag-Lloyd has also kept a tight watch on costs and remained disciplined over the capacity it deploys.

“We have been ruthless with quality of cargo and have also tried to review our services in light of profitability,” said Mr Habben Jansen. “If we cannot make money on certain services or places for an extended period of time, we will deploy less capacity.”

The uncertainty in the market also extends to fuel prices, which have seen bunker costs see-saw in the months since the introduction of IMO 2020 on January 1.

“The transition, technically, has gone very smoothly,” said Mr Habben Jansen. “Now we need to see how the bunker market settles down. In the beginning there was an enormous spike in oil prices and the spread between high-sulphur and low-sulphur fuel was very high. If you look now, the prices have come down and the spread has reduced.

“I still don’t think that is really stable at this point in time. We’ll have to see what happens there.”

The same was true of any fleet expansion plans, Mr Habben Jansen said.

“At some point we will have to order new ships, but with the situation that is unfolding now we will not be going back to the yards in the next few months,” he said. “We have to first work through this crisis. After that we will take stock again.”