Container Shipping Market free essay sample

Savannah and Port Everglades to their joint Europe-Ecuador service to cover the Europe-South US East Coast market. The service will continue to call at the Balboa hub in both directions to allow transhipment to other ports on the West Coast of South America. The rotation will be stretched to seven weeks, using 7 x 4,1324,872 TEU Panamaxes with high reefer capacity. SITC has placed an order for two 1,800 TEU containerships, with options for six more, from Taiwanese shipyard CSBC. This is the shipbuilder’s first order from a mainland Chinese company for more than 20 years. The firm vessels are priced at $23m each, and are scheduled for delivery in late 2014. Page 2 Licensed to The Hong Kong Polytechnic University. Distribution is restricted; please remember to acknowledge the source. http://www. clarksons. net 12/05/2013 09:20:16 15304 M TEU 1. 25 Jan-10 Jan-11 Jan-12 Jan-13 Jan-12 Jan-13 According to the Shanghai Containerised Freight Index, spot rates for boxes shipped from Shanghai to Europe fell to th $940/TEU on the 12 April, their lowest level since February last year and a 34% fall since mid-March, as the ains made by the last round of general rate increases proved short-lived. We will write a custom essay sample on Container Shipping Market or any similar topic specifically for you Do Not WasteYour Time HIRE WRITER Only 13.90 / page As a result of this market weakness, a number of carriers including Maersk Line and Hapag-Lloyd have postponed a second round of rate increases originally scheduled for mid-April. They will now be implemented during May. Elsewhere, freight rates for boxes shipped from Shanghai to the West Coast of America stood at $2,226/FEU, 3% below the full year 2012 average, and 11% below the January 2013 peak of $2,520/FEU. Clarkson Research Services Striking dockworkers at the Kwai Tsing Container Terminals in the port of Hong Kong caused significant disruption to a large number of liner services. Vessels faced 2-3 day berthing delays, while over 100,000 TEU of cargo was reportedly stuck on the quayside. Major carriers cancelled calls and diverted ships to other Pearl River ports such as Chiwan and Shekou, with shippers forced to tranship inbound cargo back to Hong Kong on Feeder vessels. March’s container throughput of 1. 88m TEU at the port represented an 8. 6% y-o-y decrease, yet the strike disruption is likely to affect April’s box handling volumes even more severely. Maersk Line is to increase the capacity of its India-Middle EastUS East Coast service with the replacement of 7 x 4,800 Panamax vessels with eight ships of 6,500 TEU the service turning in eight rather than seven weeks. An additional call at Algeciras will be made in both directions, while there will also be a degree of further slow steaming. The newly deployed vessels are expected to be reflagged to the US flag in order MSC is to launch a Far East-East Coast South America service using 11 x 3,000-5,000 TEU ships. The vessels include a number of Panamaxes reportedly chartered in at very low rates. The eleven week rotation will include a call in Port Elizabeth on the return leg with the first sailing is scheduled from Shanghai on the th 18 April. UASC is to enter the Far East-West Coast North America trade for the first time after agreeing to cooperate with CSCL on three separate Transpacific services. The Kuwaitheadquartered carrier will provide two Panamaxes for a service that calls in Seattle and Vancouver, and three for a Nansha-Los Angeles service. Idle Containership Fleet 12% 9% 6% 3% 0% Jan-10 Jan-11 Jan-12 Jan-13 % of total fleet capacity, TEU Source: CRSL, AXS Licensed to The Hong Kong Polytechnic University. Distribution is restricted; please remember to acknowledge the source. http://www. clarksons. net 12/05/2013 09:20:16 15304 According to data reported by Alphaliner, the total containership capacity in lay-up reached 0. 83m TEU on th 25 March, with 269 vessels sitting idle. This is equivalent to 5. 1% of the fleet in terms of capacity. Over Q1 2013 the proportion of total capacity in lay-up fluctuated between 4. 6% and 5. 3%, while across full year 2012 an average of 4. 1% of capacity was idle. Briskly expanding consumer demand in emerging economies should promote strong development of North-South trades, which are projected to grow by 6. 0% this year. Meanwhile, intra-regional trade is expected to grow by 7. 6% in full year 2013, with intra-Asian trade growth remaining the powerhouse. Global container capable supply growth is expected to be broadly in balance with global demand growth in 2013. Carriers will continue to dampen actual running capacity growth on the mainlanes in an effort to support freight rates. Managing the capacity cascade will remain rucial in determining trade lane supply, while further slow steaming may continue to absorb some of the capacity growth. However, the volume of idle tonnage is likely to continue to supress earnings in the charter market. Meanwhile, demolition remains at elevated levels. In conjunction with the paucity of ordering, this rapid rate of scrapping has resulted in a shrinking fleet in the smaller size sectors. Overall, while supp ly growth may accelerate slightly this year, the orderbook schedule for 2014+ delivery still looks relatively thin.