There will be no sustained overcapacity this year
Supply and demand will be in balance on the transpacific this year, according to carriers speaking at the Annual Trans-Pacific Maritime Conference in Long Beach.
“There will be no sustained overcapacity this year,” said Hanjin Shipping president and CEO YM Kim, who is also chairman of the Transpacific Stabilisation Agreement.
Mr Kim said containership capacity will rise 14 per cent this year, but will not affect the transpacific because most of the new tonnage has been absorbed in 10,000-TEU ships – or bigger – on the Asia-Europe trade.
“Some vessels will cascade onto the transpacific, but the number is not that different between supply and demand,” said Mr Kim.
Unconvinced, Alphaliner executive consultant Tan Hua Joo said carriers are reaching the limit of the excess capacity they can absorb through slow-steaming.
“It is still not clear if 2010 demand growth can absorb the large new ships that can only be used on the Asia-Europe and transpacific trades,” he said.
“We are looking at a significant increase in transpacific capacity, which is larger than the Transpacific Stabilisation Agreement expects.”
Carriers can only increase rates when utilisation rises more than 95 per cent, as it did last year, said Mr Tan. But so far transpacific utilisation is in the mid-80 percentile, he said.
Source: SchedNet
