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Reefer lessors battle low prices, interest rates, but see market growth

CHEAP reefer boxes and low interest rates combine to create low leasing rates for companies like Seaco, says its reefer chief Nigel Webster.

"I've been in this business for 26 years," he said, "and I have never seen a reefer container cost as little as it does today," adding that interest rates were also affecting the business.

Mr Webster who was speaking about cold chain finance at the first Cool Logistics Asia conference in Hong Kong said the equipment prices has come down considerably in the last five years after 40 years of stability.

Equipment rates are at an all time low and interest rates are at an all time low so it is not surprising that lease rates are at an all time low." he said, reported Asia Cargo News.

There are 2.5 million reefers in the world valued at US$22 billion. Of those 42.4 per cent are owned by leasing companies. Maersk has the biggest holding 483,000 reefer boxes with Seaco, the second largest, with 288,500 boxes.

Hamburg Sud is the second biggest shipping line in reefer ownership, but they are the fifth largest owner, said Mr Webster, adding that the third and fourth ranked among owners are leasing companies.

While pleading deteriorating market conditions, Mr Webster saying he wasn't overly concerned because there will still be market growth and utilisation remains stable.

"Once you've got your market and you've got your customers, you just can't walk away when the going gets tough - so that is not going to happen," he said.