The downward trend in container ship period rates worsened considerably last week with leading market indices posting their sharpest drops in a long time.
Excess spot availability and plummeting fixture rate levels especially for large gearless cellular vessels saw the Hamburg ConTex slip by 3.3% and the Howe Robinson Containership Index by 3.9% last week.
Panamax-type vessels were among the hardest hit as illustrated by reductions of 7% and 10% in ConTex rate assessments (basis 24 months and 12 months durations). French operator CMA CGM is reported to have extended the 4,330 teu Bermuda at USD10,000 per day for six to eight months for its Far East/West Africa service but the 4,256 teu Hammonia Granada is reported to have only achieved USD9,250 for four to five weeks with Cosco with delivery in Shanghai next week.
The smaller classes – up to 3,500 teu gearless – fared better, limiting week-on-week losses to 3.5% maximum, according to the ConTex.
The Hamburg Shipbrokers’ Association VHSS, which hosts the international ConTex broker panel, warned that the long-term gains in charter rate levels are disappearing fast. Compared with this time last year, spot charter rate levels in the box ship charter market are still 18% ahead today, “but in view of the general downward trend it remains unclear how long the market will stay above these levels [a year ago]”, VHSS commented.