Idle box fleet shrinks, but set to grow

Idle box fleet shrinks, but set to grow

The fleet of idled container ships declined in the past two weeks with 11 vessels securing work, but is set to increase later this month as carriers blank services on the Asia-north Europe trade, according to Alphaliner.

There were 326 jobless vessels with a capacity of 1.29 million 20-foot equivalent units, or 6.4 percent of the global fleet as of Jan. 25, down from 337 ships of 1.35 million TEUs, a 6.8 percent unemployment rate, two weeks earlier, the industry analyst said.

The idled fleet is down 107,000 TEUs from a recent peak of 1.4 million TEUs at the end of November 2015, largely due to a reduction in the number of unemployed vessels above 7,500 TEUs from 51 to 37 units.

The lower unemployment rate of the larger ships is attributed to a temporary halt in the number of void sailings on the Asia-Europe and trans-Pacific routes as carriers take advantage of the higher demand in the run up to lunar New Year vacations across Asia, with some carriers, notably Maersk, putting in “extra-sailers” to transport the higher cargo volumes.

But carriers will resume their void sailings programs this month, with some 18 sailings on the Asia-North Europe routes expected to be cancelled in February.

While these capacity cuts will increase the idled fleet, they are unlikely to be sufficient to stem the decline in ocean freight rates, according to Alphaliner.

“Despite all efforts, rates are thus expected to continue their downward spiral in the coming weeks.”

The charter market remains weak and several new ships delivered in January have been unable to secure employment so far.

Contact Bruce Barnard at brucebarnard47@hotmail.com.