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Shipper raises issue of capacity deficit with scrappings up and ship orders down
MANAGING Director of Dachser Far East, Edoardo Podesta, has questioned whether by 2020 to 2022 the container shipping industry will not face overcapacity but rather "be in an opposite situation with a deficit of tonnage," reported Seatrade Maritime News.
He noted that with the current rate of scrapping and the drop off in new orders there could be a shortage of steel on the water which would create volatility in the opposite direction from what it is now.
"The lesson to shipowners is to stop this nonsense of deploying ships when they are not needed and try to stabilise prices," he was quoted as saying. However, Mr Podesta acknowledged that by taking those measures a dramatic swing in the opposite direction could occur in future.
Mr Podesta also pointed out that the changing fleet profile will have an effect on the niche trades in the north-south trade lanes. "You are seeing the cascading effect with bigger and bigger ships deployed to these trades, not because of demand but simply because bigger ships are coming into the Asia-Europe trades and the lines needed to redeploy them," he said.
Mr Podesta also opined that many vessels in the 3,000 TEU to 5,000 TEU range may disappear because of scrapping, and with the decline into obsolescence of the panamax class, trades that would be better served with these smaller ships would be flooded with up to 10,000 TEU vessels which will inject excessive capacity.
"For sure there will be an imbalance because it's not just a mismatch of size but also of matching the right growth in the right segments," Mr Podesta said.
He suggested that in the next three to four years the market will be very heavy at the top with big modern ships of 14,000 TEU and above. As bigger ships cascade into the smaller north-south trades, this could give rise to a big overcapacity problem.
He noted that with the current rate of scrapping and the drop off in new orders there could be a shortage of steel on the water which would create volatility in the opposite direction from what it is now.
"The lesson to shipowners is to stop this nonsense of deploying ships when they are not needed and try to stabilise prices," he was quoted as saying. However, Mr Podesta acknowledged that by taking those measures a dramatic swing in the opposite direction could occur in future.
Mr Podesta also pointed out that the changing fleet profile will have an effect on the niche trades in the north-south trade lanes. "You are seeing the cascading effect with bigger and bigger ships deployed to these trades, not because of demand but simply because bigger ships are coming into the Asia-Europe trades and the lines needed to redeploy them," he said.
Mr Podesta also opined that many vessels in the 3,000 TEU to 5,000 TEU range may disappear because of scrapping, and with the decline into obsolescence of the panamax class, trades that would be better served with these smaller ships would be flooded with up to 10,000 TEU vessels which will inject excessive capacity.
"For sure there will be an imbalance because it's not just a mismatch of size but also of matching the right growth in the right segments," Mr Podesta said.
He suggested that in the next three to four years the market will be very heavy at the top with big modern ships of 14,000 TEU and above. As bigger ships cascade into the smaller north-south trades, this could give rise to a big overcapacity problem.
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