Visit Our Sponsors
During the 12 months to the end of March 2014, 192 ships averaging about 2,600 TEU were scrapped, according to Drewry’s Container Forecaster reports. Demolitions are running at about 55 ships per quarter.
About 230 new ships of all sizes are scheduled to be delivered in 2014 (i.e., about the same as 55 per quarter) and the number of new deliveries will fall to about 180 in 2015. So, the number of ships leaving the market is very close to the number entering the market.
But look more closely and you will see another trend. Of the 230 new ships of 2014, the majority of new vessels will be larger than 5,000 TEU. Whereas the sector where nearly all demolitions are happening is that of smaller ships of 5,000 TEU or less capacity.
In other words, not only are ships getting bigger (not unexpected), but also both the absolute number and the relative market share of smaller ships are falling.
And these developments have implications for ports, for shipyards and for ship charterers.
For ports, this means that volume is increasingly concentrated on fewer port calls or less frequent joint services – a development which is linked to the advent of new mega-alliances.
For shipyards, it means that the requirement for more and more vessels, particularly of small- and medium-sized ships, appears to be changing toward a requirement for the same number of bigger and bigger ships.
For vessel charterers, it is starting to look as if smaller vessels will be harder to find on the charter market. Drewry Maritime Advisors, the advisory arm of Drewry, has advised shipowners and investors on this issue.
The reduction in the fleet of smaller vessels will create investment opportunities for certain types and sizes of smaller vessels of less than 5,000 TEU.
Enjoy curated articles directly to your inbox.