News / Asia-Europe still soaking up new tonnage – but Latin America the market to watch

Photo: VesselFinder

A total of 2.92m teu of new capacity was added to the global container shipping fleet over the course of 2024, the lion’s share of new tonnage being assigned to the Asia-Europe trades, according to new analysis by Alphaliner.

While the global fleet increased by 10.6%, over 2023, the liner consultant recorded fleet growth on the Asia-Europe trades at 31%, which meant that some 59% of the new ships delivered were deployed between Asian and North European and Mediterranean ports.

“When Alphaliner last analysed the trade, in June, capacity had already grown year-on-year by 24%. Six months later, the fleet growth stands at 31%, and some carriers are still awaiting delivery of more newbuildings to fill the final gaps in their Asia-Europe schedules,” it writes in this week’s commentary.

The root cause of this higher-than-average growth was of course the Red Sea crisis, leading to extended sailing distance for vessels and thus the requirement for greater numbers of ships to maintain weekly liner schedules.

As a result, the weekly loadable capacity offered at Asian export ports grew by far less, Alphaliner noted.

“On 1 December 2023, a weekly average of 434,940 slots was offered on the Asia-Europe trade. A year later, this had risen by only 38,360 teu, or 8.8%, as re-routing gobbled up capacity,” it said.

In comparison, capacity deployed on Asia-North America routes increased by just 2.9% during 2024, despite the continuing strength of demand from US importers and reflecting the general shortage of ships worldwide.

“While many commentators were warning of potential overcapacity in 2024, the Cape diversions absorbed so much capacity that the industry terminated the year with almost no idle tonnage – just 0.6% of the total containership fleet was deemed commercially inactive,” writes Alphaliner.

And it is forecasting that 2024 will turn out to be the third-highest earner for carriers, after the pandemic years of 2022 and 2021, as the shortage of capacity continues to keep freight rates elevated.

It adds that one region “to watch out for this year” is Latin America, which also saw significant capacity additions over the course of last year.

“We saw a very steep increase in the capacity of liner services to and from Latin America. This includes both deepsea and regional loops, where 15% of the global fleet is now active. These trades received 853,000 teu of capacity during the past 12 months, representing a 22.4% year-on-year rise,” writes the analyst.

“To put it differently, 16.9% of all additional tonnage which was added to the fleet during the last 12 months was assigned to Latin America-related services,” it adds.

According to Maritime Strategies International’s December container market analysis, volume growth between Asia and Latin America in the first nine months of last year reached 10.4%.