United Parcel Service, the world’s biggest package-delivery company, conceded it would face a “challenging environment for a number of quarters” as the economic slump sapped demand for shipping goods.

Considered an economic bellwether for its role in facilitating global trade, UPS yesterday reported a 12 per cent drop in third-quarter net income. US package volume, which typically tracks at or slightly above the pace of growth in gross domestic product, dropped 3.4 per cent in the third quarter and may drop another 4 per cent in the fourth.