Free Porn
xbporn
22 C
Hamburg
Thursday, July 25, 2024
Home News Booming charter market driven by mid-sizes

Booming charter market driven by mid-sizes

The container market is on fire, according to Braemar which outlines the combination of geopolitical upheaval and market economics that is driving parts of the charter market ever upwards, with every sector in the broker’s index on the up.

Braemar’s Monday Briefing note, for 10 June, suggested that charter periods are becoming longer, even for feeder vessels of under 2,000 TEU, that were lagging behind the larger sized vessels, while the same report pointing to rumours of a “batch of 3,500 TEU vessels”, available in the next few months with new charters.

Those rumours may have been about Hapag-Lloyd which Alphaliner reports has fixed seven ships of up to 3,000 TEU.

“Periods of 24 months are now the norm and 36 months deals are also beginning to appear with at least one vessel, the 2,954 TEU Green Park believed to have secured such an employment with Hapag at US$25,000/day,” said Alphaliner.

Dynamar consultant Darron Wadey commented, “If the Hapag-Lloyd spree is indeed related to the Gemini Cooperation (it depends on when it would receive these vessels), they would seem ideal for the regional shuttles the partners have proposed. In fact, they have already suggested some of these ‘supersized’ feeder connections could even employ ships of 5,000 or 6,000 TEU.”

It is a theme that Braemar has also looked at, reporting that the mid-size sector of 4,000-9,999 TEU has seen significant under-investment in recent years with virtually no newbuildings between 2016-2021.

“We are now only just seeing the next generation of mid-size box ship newbuildings being delivered,” pointed out Braemar analyst Jonathon Roach.

These mid-sized vessels are also seeing increases in prices and extensions to the charter periods.

According to Braemar, the Red Sea diversions, which have caused delays and congestion due to the longer transit times, have also led to an empty equipment squeeze, pushing spot rates to new highs.

Those elements have been added to by the earlier-than-expected onset of peak season, through May-June, creating extraordinary demand as warehouses are being front-loaded to avoid supply chain snarls.

“With hot freight markets liners are responding, with additional services and extra loaders being created as rates promote potentially short-term service requirements, which are often utilised with charter tonnage. Additionally, longer transit times will require more tonnage, again the charter market will benefit as liner companies mitigate service disruption,” said Roach.

It was a theme that Xeneta’s chief analyst, Peter Sand, had also picked up, noting: “Charter rates are up 100% since mid-December.”

“A few new services on the transpacific trades with services in that ballpark [3,000-3,500 teu] with carriers looking to ease the pain on Far East to West Mediterranean hubs congested with cargo heading to the East Mediterranean.”

Carriers wanting charters to feed East Mediterranean destinations, which can no longer be served with ships through Suez due to the Gaza conflict, are competing for ships with new services operating on the booming Pacific trade to the US West Coast.

“Increases in demand for tonnage naturally drive the rates and periods of charters north (and the Red Sea is clearly a contributor here), so there is nothing untoward in such developments. It is also common to see operators engaging in portfolio like charter deals in such times,” argued Wadey.

According to Sand, carriers are eager to return vessels back to Asia to pick up the high-paying cargo, but the carriers are learning lessons from the covid debacle, where boxes were dropped anywhere in the rush back to the Far East and are also moving empties so that they can maintain the flow of cargo.

“With all these moving parts, we are naturally seeing a squeeze on mid-sized tonnage pushing up charter values, charter periods and asset values. We expect this to continue and possibly increase while Red Sea avoidance is in play,” concluded Roach.


Mary Ann Evans
Correspondent at Large





Latest Posts

Global bunker indices continue moderate decline

In the 30th week of the year, the Marine Bunker Exchange (MABUX) global indices maintained their moderate downward trend. The 380 HSFO index dropped by...

BIFA and TT Club provide advices on container shipping safety

The British International Freight Association (BIFA) used the latest episode in its 2024 webinar series to provide crucial advice on safety in container shipping. The...

Indian Register of Shipping reveals new leadership appointments

The Indian Register of Shipping (IRS) announced new leadership appointments aiming to strength its management team. The Board of Directors of IRS has approved the...

CMA CGM applies updated PSS from Egypt and Türkiye to West Africa

French ocean carrier CMA CGM has notified its customers of an updated Peak Season Surcharge (PSS) from Egypt and Türkiye to West Africa. Effective from...

NWSA announces refrigerated electrical upgrades on Terminal 5

The Northwest Seaport Alliance (NWSA), a marine cargo operating partnership of the ports of Seattle and Tacoma, has announced refrigerated electrical upgrades on its...