Ocean carriers have reached the limit of slowing the speed of their ships to soak up surplus capacity and must now cull services and idle more vessels to rebalance the container market, Alphaliner said.
Extra slow-steaming is firmly rooted on almost all long haul routes and is currently absorbing around 750,000 20-foot equivalent units, or 4.9 percent of the world container ship fleet, according to the container market analyst. The total capacity absorbed through additional slow steaming has increased slightly in the past six months with rising bunker prices.
But the positive effects on overall fleet employment have been offset by the closure or suspension of several long haul service loops that were already operated on extra slow-steaming, Alphaliner said. The benefits of lower fuel consumption from slow-steaming have reached a limit, with any further slowing down of sailing speeds unlikely to yield significant cost savings.
“Carriers will need to manage the excess capacity situation in the coming months through the removal of further service loops and the idling of surplus vessels,” Alphaliner said.
The idle container ship fleet has increased to 676,000 TEUs from 595,000 TEUs at the end of 2011, according to the industry analyst.
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