China reprisal puts Panama-registered box ships on course for new flags
More than 100 containerships have reflagged from Panama to other registries in response to China’s ...
Photo: © Gary Blakeley | Dreamstime.com
A charter market correction could be looming amid the deterioration in spot rates. Citing the Shanghai Containerised Freight Index, Splash reports that spot rates have plummeted some 47%. And, while profitability remains possible as long as utilisation remains above 80%, the same report notes that box ship utilisation on the world’s biggest trades has now dipped below 90%.
Despite the year starting in contraction, the charter sector has been experiencing something of a boom, with the charter to freight ratio at a high of 289%. The Splash report suggests carriers could seek to correct this by releasing tonnage onto the charter market.
Comment on this article
Mike Wackett
March 19, 2025 at 11:01 amUnlike freight rates, containership charter rates will not collapse overnight. Existing fixtures have a some way to run and owners are sitting on several more quarters of good returns. As we have seen before with Zim and others, carriers may indeed attempt to sub-let excess capacity to mitigate their losses.