Fans of American toilet paper in Poland back on a roll
Americans concerned over personal hygiene following the start of the port strike have reportedly panic-bought ...
HLAG: GREEN DEALXOM: GEOPOLITICAL RISK AND OIL REBOUND IMPACTZIM: END OF STRIKE HANGOVERCHRW: GAUGING UPSIDEBA: STRIKE RISKDSV: STAR OF THE WEEKDSV: FLAWLESS EXECUTIONKNIN: ANOTHER LOWWTC: TAKING PROFITMAERSK: HAMMEREDZIM: PAINFUL END OF STRIKE STLA: PAYOUT RISKAMZN: GOING NOWHEREAMZN: SEASONAL PEAK PREPARATIONS
HLAG: GREEN DEALXOM: GEOPOLITICAL RISK AND OIL REBOUND IMPACTZIM: END OF STRIKE HANGOVERCHRW: GAUGING UPSIDEBA: STRIKE RISKDSV: STAR OF THE WEEKDSV: FLAWLESS EXECUTIONKNIN: ANOTHER LOWWTC: TAKING PROFITMAERSK: HAMMEREDZIM: PAINFUL END OF STRIKE STLA: PAYOUT RISKAMZN: GOING NOWHEREAMZN: SEASONAL PEAK PREPARATIONS
Boxship charters could get a real boost from the US east coast’s biggest port strike in half a century, a perfect storm in which idle tonnage remains below even Covid levels.
Data from an Alphaliner survey conducted at the end of September indicated that just 56 ships, boasting a combined capacity of less than 200,000 teu and equivalent to just 0.6% of the total global fleet, are commercially idle.
However, Alphaliner said container shipping could “still be considered fully employed, despite the recent decline in rates and a potential slowdown for Chinese Golden Week”.
It added: “After nine months of the year, the idle fleet has averaged 0.7% of the total fleet, actually lower than in the equivalent period in the peak Covid years of 2021 (0.9%) and 2022 (0.8%), despite the surge in newbuilding deliveries.”
These have added some 2.3m teu of cellular capacity to the global fleet this year.
But this influx of capacity has coincided with the near-year-long Red Sea crisis, which has forced carriers into longer sailings, around the Cape of Good Hope, and soaked up all the new capacity hitting the market.
Were it not for this, there would be sufficient capacity to mitigate the impact of ships waiting at anchor outside US east and Gulf coast ports, together with demand from other trades.
Alphaliner added: “Although many carriers anticipated this crisis, chaos is expected and vessels will inevitably be seen queueing outside ports, deviating to strike-free terminals or simply cutting-short rotations.
“If it lasts, the consequences for the charter market could potentially be positive, with carriers needing to secure additional tonnage at a premium to compensate for a squeeze in capacity.”
Carriers have already been feeding from the charter market, leaving the sector in a strong position to demand elevated rates to satiate strike-induced demand, but with large ships in short supply, those with vessels of under 2,000 teu will see new opportunities.
All in all, it has led to situation in which charter rates are heading in the opposite direction to freight rates that have seen an accelerated pace of decline.
“On Friday, the Shanghai Containerized Freight Index (SCFI) was down by nearly 10% on many trades; Asia-North Europe, Asia-Med and Asia-USEC seeing double-digit drops,” Alphaliner noted.
“The strikes on the US east coast could, however, see this trend reversed, especially in a context of persistent tight supply caused by the continued disruption in the Red Sea.”
This assessment was reflected in a report from Maritime Strategies International, which notes that “the structural shortage of prompt vessels available for hire continues to be the dominant factor at play in the market”.
It added that as far as large boxships were concerned, “the shortage is currently universal”, and it noted that carriers were “reportedly scrambling for tonnage for delivery in 2025”.
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