Danish shipping company Maersk slashed its forecast for shipping container demand this year, as it warned that this week saw a collapse in demand for transport and logistics services.

Maersk CEO Soeren Skou issued a statement saying, “It is clear that freight rates have peaked and started to normalize during the quarter, driven by both decreasing demand and easing of supply chain congestion.”

Often seen as a barometer of global trade due to its status as the world’s biggest shipping company, Maersk says it now expects to see a contraction in container demand of between 2% and 4% in 2022. It is a significant reduction from its previous projection that the change in demand would be between +1% and -1%.

In his statement, Skou warned, “With the war in Ukraine, an energy crisis in Europe, high inflation, and a looming global recession there are plenty of dark clouds on the horizon. This weighs on consumer purchasing power which in turn impacts global transportation and logistics demand. While we expect a slow-down of the global economy to lead to a softer market in Ocean, we will continue to pursue the growth opportunities within our Logistics business.”

During the pandemic, freight rates soared as demand for shipping took off, producing congestion in ports and shipping delays that spiraled into a supply chain disaster. Even as container demand has fallen, prices are still higher than they were before the pandemic.

For its part, Maersk is still predicting that its average contract rate will be higher in 2022 than 2021. However it has downgraded its guidance over the year, with the projected average contract rate for the year per container now $200 lower than the company had forecast in August.

In its quarterly report Wednesday, the company reported that earnings before interest, taxes, depreciation, and amortization (EBITDA) came in at $10.9 billion for the quarter. That was up roughly 60% from one year prior, and beat analyst estimates of about $9.8 billion.