The global container ship fleet will see record growth in 2015, while the demand for capacity will remain subdued, particularly due to weak demand from Europe, a senior shipping analyst has predicted.
“2015 will see a record inflow of newbuild tonnage. BIMCO forecasts close to 1.6 million teu will be delivered by the end of 2015. This marks the highest inflow of new capacity ever,” said Peter Sand, chief shipping analyst at BIMCO in Denmark.
It will be done by fewer than 200 ships, he noted in a report emailed to IHS Maritime. “The trend is strong, as 436 ships were needed to reach 1.502 million teu in 2008.”
Figures gathered by statista.com show that the global container ship fleet had a combined capacity of 18.76 million teu on 1 April.
“The lack of European demand is of concern,” Sand said. “In the short term, this is because container shipping is a low-margin business and industry profitability requires sustainable freight rates on high-volume trades. In the long term, half of all new ships are bound for a future on the Asia to Europe trading lane, cascading the present work horses on to other trading lanes.”
He added that a successful cascading of ships left over from higher-volume trades should not increase supply of capacity beyond requirement on the secondary trades where they are about to be deployed.
“The container shipping market may find comfort in the fact that global volumes were up by 1.1% in the first six months of 2015. Following a disastrous first quarter, all three months of the second quarter posted year-on-year increases. Behind the headline, though, the story of US east coast imports was the only positive one on the vital east-west trading lanes,” Sand pointed out.
Last week, another senior Danish analyst warned that owners’ continued willingness to order large ships in pursuit of economies of scale would delay a cyclical recovery in the industry. “The rates are flirting with historic lows in Asia-Europe trades and values of secondhand tonnage have dropped marginally in the course of past month,” said Jacob Pedersen, senior analyst at Sydbank in Denmark.
“This highlights a continued very weak balance in the market,” Pedersen said in a monthly review of the shipping markets, adding that this was an indication of insufficient demand for capacity despite the high season.
“Furthermore, we note that there is a lot of eagerness at many owners to order newbuildings in an effort to improve economies of scale by ordering large ships. This [keeps] the market out of balance for longer than so far anticipated.”