News / Charter market still heated, lack of open tonnage keeping rates high

Photo: © Joseph Golby

Some VOCCs [vessel-operating common carriers] appear to be “shifting strategies” for ship acquisition in response to “today’s firm rates”, according to maritime industry analyst Braemar.

In its Monday Morning Container Briefing, Braemar reports that capacity demand continues to outstrip supply and, as a result, the appetite for charter vessels remains high and their owners can hold out for higher rates. 

Carriers, confident the high demand will be sustained, have reportedly fixed agreements for vessels at the end of the year.  

“A couple of modern 1,800 teu vessels are said to have been fixed or extended with one of the major European liner players for Q4 25 onwards,” revealed Braemar.  

While details are scant, rumours suggest these are two-year deals at “rates above the last-done levels”.  

Meanwhile, on the Atlantic trade, the 925 teu Perseus has been secured by Sealead Shipping for some 18 months at a rate of $15,200 a day; Zim is paying $35,500 a day for 35 months to charter the 4,250 teu Kota Lagu from October in North-east Asia; and CMA CGM has extended charters on two vessels in South-east Asia – the 3,091 teu Lutetia and the 1,032 teu Padian 3, for $24,000 and $16,000 a day respectively.  

The three-year charter extension of the Lutetia follows a longer-term deal, but according to Braemar, “the reported rate of $24,000 a day came as a surprise, falling below current market expectations”.  

It added: “It is believed there may be additional background or specific circumstances behind this deal, as comparable tonnage from other owners demands significantly higher levels.”

The sky-high market rates and demand for charter vessels is pushing some carriers to reconsider their approach, according to Braemar.  

“It seems some operators, and not just MSC, might be shifting strategies, looking to buy ships rather than commit to long-term charters at today’s firm rates,” suggests the analyst.  

The feeder segment in particular has been “driven by a very active sale and purchase market”, which has prompted VOCCs to start tonnage discussions early.  

“A few vessels between 3,000-5,000 teu, toward the tail-end of their current charter parties, are under close discussions to be purchased by their current charterers,” reported Braemar.  

“With the freight market having looked to have peaked, one would normally expect pricing to plateau, or experience a pull-back. However, the dearth of ships may be able to carry on the momentum, regardless,” it concluded.