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Container lines get creative to keep idle fleet ‘artificially’ low
Source
American Shipper
Post Date
01/06/2023

Ocean carriers are pulling out the stops to avoid idling container ships as slumping demand shows no sign of receding and freight rates slide.

Capacity management measures include diverting ships for longer voyages, super-slow steaming and deferring newbuilding deliveries, say analysts. These are helping keep idle teu capacity of the commercially active fleet at just 2.2% of the fleet, excluding vessels in repair yards, according to Alphaliner estimates.

Several carriers have already begun diverting ships on the backhaul trip from Europe and the East Coast of the United States. The vessels are being sent on the longer route around the Cape of Good Hope rather than through the Suez Canal or Panama Canal. That requires extra vessels and sucks into operation ships that might otherwise be idled. By super-slow-steaming as low as 10 knots, the detour from Europe will absorb two extra vessels for every weekly loop,

Alphaliner estimates. The route also makes financial sense for carriers and by avoiding hefty fees to transit the canals, it adds.

Vessels taking the detour around the Cape of Good Hope include the 19,970-teu Al Nefud (built 2015), which is operated by Germanys Hapag-Lloyd. Several ships of The Alliance carriers (Hapag-Lloyd, HMM, Ocean Network Express and Yang Ming Marine) have started diverting ships.

That is seen as “a clear sign that excess tonnage is now the bigger problem for carriers while congestion has been relegated to a secondary concern”, according to analyst Linerlytica. Operators are also seeking to defer delivery of many large container ships from late 2022 through to 2023. Mediterranean Shipping Co (MSC) looks set to push deliveries back, with about 20 container ships officially earmarked for delivery in December, said Alphaliner. The 24,116-teu newbuilding MSC Tessa was initially expected to join MSC services in November but has its phase-in postponed to February. “Carries and shipyards have apparently negotiated later deliveries that will turn many a big ship from a 2022-built vessel into a 2023-built ship,” the analyst said.

Liner operators have unveiled a wave of blank sailings ahead of Chinese New Year when shipments out of Asia are expected to slump further. MSC Group wraps up $6bn African logistics deal. On Thursday, the 2M Alliance partners Maersk and MSC said they would void the Asia-Europe sailing of the 16,652-teu MSC New York (built 2014). The vessel was scheduled to sail from Ningbo on 4 January. “As a consequence of the foreed reductions in global demand, Maersk is looking to balance the network accordingly,” the Danish carrier said.


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