Seatrade Blue
Photo: VesselFinder

Unexpectedly strong demand for container shipping and healthy freight rates for much of last year led to a doubling in the values of secondhand vessels, according to new research from Alphaliner.

Sales and purchase activity in the container sector in 2024 saw 333 vessels bought and sold, totalling 1.1m teu capacity, compared with the 285 ships, equating to 937,000 teu, sold in 2023, making last year the third-strongest for secondhand deals, after 2021 and 2019, when the market was distorted by the Hanjin bankruptcy and the sale of its fleet.

“Apart from the summer months of July and August, and a traditionally quieter December, the market was busy the whole [of last] year, with over 30 transactions concluded every month, on average,” Alphaliner writes today.

“Contrary to 2023, which saw a significant softening of prices throughout the year, ship values increased strongly in 2024, with some vessels changing hands in the last quarter at twice the price they could obtain at the beginning of the year,” it adds.

However, while brokers enjoyed hefty commissions last year, the prognosis for 2025’s secondhand market is largely dependent on when, or if, carriers will revert to Suez Canal transits following the Houthi declaration that the group has ceased attacks on non-Israel-linked commercial shipping.

Should carriers return en masse to the Egyptian waterway, the effect on the supply-demand balance across most trades is likely to be significant, which Alphaliner expects to lead to an upsurge in ship scrapping.

“Once the Suez route is again widely used, the market could take a different turn,” it said. “With 2m teu of newbuilding capacity expected to hit the water in 2025, the return of overcapacity is a threat, especially if cargo demand falls short of its 2024 vitality.

“The secondhand sale and purchase market could then take a hit, with a rising number of candidates offered for sale, and falling prices.

“This could prompt some owners of older and less-efficient units to turn to the recycling market instead, paving the way for a long-expected rally in demolition sales,” it writes.

Meanwhile, one of liner shipping’s greatest fleet expansion programmes has been under way at MSC since its war chest was piled high with pandemic-era riches. The analyst noted that in November, MSC “hit the symbolic threshold of 400 secondhand container vessel acquisitions since August 2020”.

Last year, the Geneva-headquartered carrier again accounted for the most secondhand purchases, with 70 vessels acquired, totalling 330,000 teu, representing just under a third of all secondhand capacity sold.

It was followed by CMA CGM, which has been almost as aggressive as MSC in building up its fleet. The French carrier bought 15 secondhand box ships last year, including five of the high reefer capacity Seatrade Colour series – Seatrade Red, Seatrade Blue, Seatrade Orange, Seatrade Green, and Seatrade White – from Dutch reefer operator Seatrade.

The 2,250 teu vessels, which feature 672 reefer plugs, have been deployed to CMA CGM’s round-the-world service connecting Europe, North America and Oceania via the Panama Canal.

Built in 2014 and sold to Seatrade for $30m apiece, their sale price to CMA CGM of $29.8m, according to vesselsvalue.com data, in the final months of 2024 illustrated how well secondhand vessel values held up last year.

Meanwhile, most of the vessel sellers were non-operating shipowners, according to Alphaliner.

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