Tag: overcapacity

Two years ago, the Boston Consulting group highlighted that slow growth in global demand coupled with a persistent oversupply of vessel capacity, was a major industry challenge. Although global container demand did improve in 2017, overcapacity is expected to remain in the range of 6% to 9% in 2020.

Container shipping faces more overcapacity and financial pain

Overcapacity remains a concern in shipping

Shipbuilding Industry Makes a Soft Landing

The industry has defeated overcapacity

Zodiac Maritime Agencies chairman Eyal Ofer blames China for building too many ships "The shipping sector is going through a terrible and dark period, and you have to remember that without shipping there is no international trade. The current situation will continue for at least two years and perhaps even three and meanwhile there is no hope for change," Zodiac Maritime Agencies Ltd. chairman Eyal Ofer said yesterday at the Milken Institute's annual global conference in Beverly Hills, California.He said, "The difficult situation sweeping through the sector is caused by a combination of factors: the rise in the cost of fuel, the economic slowdown and above all else huge overcapacity in shipping among other things because of China. The pessimistic picture that I am painting is far worse in reality."Eyal Ofer added, "The shipping industry needs to reshape itself with the level of fuel and transport costs looking as though they are going to remain at the same level."He said that the planned expansion of the Panama Canal, allowing the passage of larger ships, was a potential bright spot for his industry. "If world growth is accelerated, the amount shipped will be increased," he explained, "But if there are too ...

There are too many ships heading for the long-haul trades Overcapacity in the container shipping industry will not be absorbed quickly unless the global economy rebounds strongly in the next two years.OSK Research said a strong economic recovery would be reflected in container shipping demand to jump above 10% from the expected 4% to 7% in 2012 and 2013."In terms of vessel supply, there are too many ships headed for the long-haul trades."However, there is one small positive structural development. MSC, a leading global carrier, deployed a 12,000 TEU vessels to the transpacific market, providing the potential for fewer ships to flood into Asia-Europe during this critical 2012 and 2013 period," said OSK in a recent sector update report.However, OSK said the influx of 10,000 TEU ships into the transpacific before 2014 to 2016 was not expected to occur, as most terminals would not be able to handle these ships although 50% the vessels in the orderbook were more than 10,000 TEU ships.As for the 2012 orderbook, OSK said it would still be at least 2% above demand and little that could be done as most of the ships were close to be fully-paid."But by 2013 and 2014, we should ...

Ocean carriers face a growing capacity glut in 2012 Ocean carriers face a growing capacity glut in 2012, especially on the key Asia-Europe trade lane, as ship deliveries accelerate from last year while cargo demand weakens over the coming 12 months, Alphaliner forecast.The global container ship fleet is set to grow 8.3 percent, or 1.28 million 20-foot equivalent units, this year. The growth will outpace the 7.9 percent expansion in 2011, when shipyards delivered 127 vessels of 1.23 million TEUs, the container market analyst said.The growth in demand, by contrast, is forecast to slow to 6.5 percent in 2012 from an estimated 7.7 percent in 2011.Some 253 container ships of 1.47 million TEUs are due for delivery in 2012, but this likely will drop to around 228 vessels of 1.39 million TEUs after allowing for delivery slippage. A further 120,000 TEUs of capacity is expected to be scrapped, according to Alphaliner.Almost half of the ships slated for delivery in 2012 are above 10,000 TEUs, most of which are earmarked for deployment on Asia-Europe routes."The order book bias toward large ships will exacerbate the oversupply afflicting the main East-West trades," Alphaliner said.All of the top 20 ocean carriers, with the exception ...

Trade to grow only in single digits this year Analyst Alphaliner has reported that the total volumes of containership deliveries in 2013 could hit 2 million teu.This reignites concerns that overcapacity could again become an issue.It forecasts that total capacity in 2013 would increase by at least 8.9% and as much as 11.3% if all options and letters of intent are exercised.At the recent Containerisation International 13th annual Global Liner Shipping Conference in London, Nicolas Sartini, Senior vice-president at CMA CGM warned that unless volumes pick up, overcapacity will drive rates down while bunker costs will soar and profitability will plunge.However, some experts predict trade will grow in single digits this yearModerate growth in container volumes across Europe seen in the beginning of the year have continued in March, according to Hackett Associates and the Bremen Institute of Shipping Economics and Logistics.The latest Global Port Tracker: North Europe Trade Outlook said low volumes in February led to a relatively weak quarter, with a total of 5.52 million teu.This represents a 2.1% increase over the previous quarter and an 8.9% year on year gain. In February it predicted imports in the first quarter of 2011 to increase 7.3% year on year.European ...