By Mike Wackett
The number of containerships in lay-up has dipped below 100 in January, according to Alphaliner, whose Its latest survey reveals strong demand and tightening availability of tonnage which is putting the brakes on vessel scrapping.
As at 8 January, there were 99 vessels, equating to 377,784 TEUs, anchored in hot or cold lay-up. This compares with 351 ships for 950,000 TEUs a year ago. At 1.8 per cent of the global cellular fleet, idled container tonnage is at its lowest level since mid-2015.
“The availability of tonnage is tightening for all sectors below 6,000 TEUs, and this has been reflected in strengthening charter rates,” said the consultant. In particular it noted that there had been a “remarkable change in fortunes” for the panamax sector, with only thirteen 3,000-5,100 TEU ships still seeking employment, against the 99 unemployed units of 12 months ago. Indeed, one broker source told The Loadstar today that finding a spot panamax vessel in Europe was “becoming increasingly difficult”. He said: “Most of the available ships are at anchor in Asia, and even some of those would need at least a couple of weeks to be reactivated.” He added that on the plus side, charterers were extending available options which, he suggested, would mean daily hire rates increasing.
Reports are also coming in of charterers talking again of 12-month or even 24-month hires, a sign that cargo owners believe they need to lock into today’s rates rather than stick to their previous strategy of fixing for three-month-plus options. In the past month, the market rate for panamax ships has jumped by $1,000 to some $9,000 per day, and the broker said he expected a further surge in the weeks before the Chinese New Year holiday in mid-February.
Demand is also strong in the 5,000-7,500 TEU sizes, but brokers are reporting “mixed fortunes” for owners of 7,500 TEU vessels and above. Alphaliner noted “healthier” charter rates for certain higher-specification vessels, but suggested the environment remained “fragile” for the sector, due to the large number of newbuild ultra-large container vessels (ULCV) slated for delivery in the first six months of the year. Their arrival will cause significant cascading, particularly of the 8,000-10,000 TEU sizes, warned the consultant.
And with the supply/demand balance for tonnage tilting back in their favour, owners of older containerships are adopting a ‘wait and see’ approach to recycling, despite improving scrap rates. London shipbroker Braemar ACM reported by mid-January that so far this year there has not been a single container vessel sold for demolition, compared with 20 of 60,500 TEUs sold for scrap in the same period of 2017.
In terms of new tonnage there have been 143 deliveries in 2017 to mid-December, equating to 1.1 million TEUs. This includes the 21,413 TEU OOCL Scandinavia – the fifth in a series of six ULCVs ordered by the Hong Kong carrier.
There are 34 ships of 20,000 TEU and above stemmed for delivery in 2018, which will need to be deployed on Asia-Europe trades. Alphaliner said it was “unclear” how the extra capacity could be absorbed, particularly if cargo demand should waver. It said that, in this respect, “some pressure” was developing in the larger sectors of the charter market, and noted that the number of idled ships of 7,500 TEU and above was on the increase, in contrast to smaller containership sizes.
Meanwhile, in the first two weeks of this year, 13 newbuild vessels, with a nominal intake of 118,500 TEUs, have been delivered, most being phased into the Asia-Europe tradelane.
Reprinted courtesy of The Loadstar (www.theloadstar.co.uk)