Flood of new tonnage outpaces delivery deferrals and ship breaking

Source:shippingazette

THE alarm bells are ringing anew with another analyst warning of overcapacity in the container shipping market into 2014, as record new capacity ordered in more prosperous times enters the world fleet this year.

The scramble by shipowners to remove excess capacity through an upsurge in vessel delivery deferrals and scrapings will, nonetheless, fail to prevent the net capacity increase hitting 7.3 per cent. Overcapacity will continue to outpace demand.

According to Alphaliner data, 1.68 million TEU of extra cellular capacity is due for delivery this year, as of March 1. This tops the previous record of 1.57 million TEU delivered in 2008. 

It observed that the poor trading environment has set in motion a drive by vessel owners to postpone delivery of new ships due for this year, with a total capacity of 200,000 TEU, until the next. 

Of particular note, the number of 10,000-TEU plus ships to be delivered in 2013 has dropped to 41 units, adding that additional deferrals are expected to be finalised in the coming months. 

"Even assuming that a further 100,000 TEU could be deferred in the coming months, the total new vessel deliveries are still significantly higher than during the previous four years, raising fresh concerns that the over-supply in the containership markets could persist until 2014," its analysts concluded.

Weak trading conditions have also ramped up containership scrappings. It said between January and February 37 ships of a combined 80,000 TEU have been delivered to scrap, or de-celled. A further 10 ships totalling 20,000 TEU will be scrapped this month. 

It estimates the total box capacity to be removed over the course of the year through "deletions" will exceed 400,000 TEU, which would be the highest level ever, provided the current rate of scrapping continues.

Denmark's Maersk Line is expecting a bumper delivery of what will become the world's largest containerships, after twenty 18,270-TEU monsters arrive between now and 2015. Four of them are to be delivered this year, starting with the McKinney Mueller. The remaining 16 units are slated for delivery in 2014 and 2015, with about one a month.

Other super massive ships are also due in the next few months, including four 13,350-TEU ships for China's Cosco. The last four in the series of eight are due from the Nantong Shipyard in 2014.

The APL Temasek, the first of ten 14,000-TEUers ordered by the Singaporean shipping line from Hyundai Samho Heavy Industries in June 2011. Deliveries of the final four ships in the series have been delayed until the first half of 2014. The other five have been chartered to MOL in an intra-alliance arrangement.

CMA CGM will take delivery of the second in a series of three 16,000-TEU vessels, the Alexander von Humboldt, from Daewoo (DSME) shipyard. The last ship, the CMA CGM Jules Verne, will arrive in May.