Fashion Industry Driving Demand for Green Shipping, Maersk Says

Containers are seen on the Maersk's Triple-E giant container ship Majestic Maersk, one of the world's largest container ships, next to cranes at the APM Terminals in the port of Algeciras, Spain January 20, 2023. REUTERS/Jon Nazca/File Photo
Containers are seen on the Maersk's Triple-E giant container ship Majestic Maersk, one of the world's largest container ships, next to cranes at the APM Terminals in the port of Algeciras, Spain January 20, 2023. REUTERS/Jon Nazca/File Photo
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Fashion Industry Driving Demand for Green Shipping, Maersk Says

Containers are seen on the Maersk's Triple-E giant container ship Majestic Maersk, one of the world's largest container ships, next to cranes at the APM Terminals in the port of Algeciras, Spain January 20, 2023. REUTERS/Jon Nazca/File Photo
Containers are seen on the Maersk's Triple-E giant container ship Majestic Maersk, one of the world's largest container ships, next to cranes at the APM Terminals in the port of Algeciras, Spain January 20, 2023. REUTERS/Jon Nazca/File Photo

Fashion brands are a key driver of demand for green shipping fuels, according to shipping group Maersk (MAERSKb.CO), as the sector faces pressure from consumers and regulators to reduce their climate footprint.

Retailers ship huge volumes of clothes from production centres in countries such as China, Vietnam and Bangladesh to consumers around the world, causing carbon dioxide emissions, according to Reuters.

Overall, the textile industry is estimated to be responsible for between 2% and 8% of global greenhouse gas emissions, according to a United Nations Environment Programme report published last month.

The shipping industry, which itself aims to achieve net-zero emissions by 2050, has begun offering low-emission fuels such as biofuels made from cooking oil and food waste or methanol produced from renewable energy as an alternative to fuel oil.

The fashion industry accounted for 26% of the more than 240,000 containers that Maersk shipped last year using biofuels under its ECO Delivery contracts, making it the biggest sector using the low-emission fuel service, the company said.

"Many of the fashion brands have actually been the ones going for this," Josue Alzamora, global head of lifestyle vertical at Maersk, told Reuters at this week's Global Fashion Summit in Copenhagen.

"Of course, fashion companies also feel the pressure from consumers," Alzamora said.

Nearly one out of 10 containers Maersk, the number two global ocean container shipping firm, handled for owners of fashion brands last year was shipped using biofuels, he said.

The ECO Delivery contracts are sold at a premium to regular shipping.



L'Oreal Reports 3.4% Rise in Third-Quarter Sales

The logo of L'Oreal is seen on beauty products in a supermarket in Chanverrie, France, October 16, 2024. (Reuters)
The logo of L'Oreal is seen on beauty products in a supermarket in Chanverrie, France, October 16, 2024. (Reuters)
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L'Oreal Reports 3.4% Rise in Third-Quarter Sales

The logo of L'Oreal is seen on beauty products in a supermarket in Chanverrie, France, October 16, 2024. (Reuters)
The logo of L'Oreal is seen on beauty products in a supermarket in Chanverrie, France, October 16, 2024. (Reuters)

French cosmetics giant L'Oreal reported a rise in third quarter sales on Tuesday that missed expectations after low consumer confidence in China sapped demand for beauty products.

The company, which owns the Maybelline and Lancome brands, said sales for the three months to the end of September were 10.28 billion euros ($11.11 billion), a 3.4% rise on a like-for-like basis at constant exchange rates.

It was below a Visible Alpha consensus of 6% cited by Jefferies.

Shares in Paris-based L'Oreal have lost 20% since June, wiping about 50 billion euros off its valuation, on investor concerns about consumption in China.

The North Asia region, dominated by China, accounts for a quarter of group sales, but persistently weak demand in the world's No. 2 economy has curbed consumer spending.

Sales in North Asia declined 6.5% in the third quarter, said the company, worsening from a decline of 2.4% in the prior three months.

"In mainland China, the beauty market – already negative in the second quarter – continued to deteriorate, impacted by low consumer confidence," the company said in a statement.

China grew at the slowest pace since early 2023 in the third quarter, data showed on Friday, with luxury bellwether LVMH saying last week that consumer confidence in the country was at an all-time low.

LVMH, Ray-Ban maker EssilorLuxottica, and Salvatore Ferragamo all blamed China weakness for missed third quarter sales estimates last week.

Sales growth in Europe, L'Oreal's biggest region at a third of group sales, also slowed in the third quarter to 5.6% from 9.7% in the prior quarter.