Red Sea crisis: idle container ship fleet contracts

Alphaliner’s latest weekly report on the shipping market says that the idled fleet is now at its lowest level for more than 22 months at just 84 ships of which one is larger than 12,500 teu and none are greater than 18,000 teu.

The number of vessels that are in repair yards has also dropped significantly over the last two weeks, falling to 99 ships on 12 February, totalling 236,266 teu, an average size of under 2,400 teu. A reduction of six ships, consisting of 73,769 teu, averaging around 12,300 teu per vessel.

According to the Alphaliner report, in comparison to last year this is a substantial reduction, with “the combined idle and ‘ships in yard’ capacity collectively represented 6.2% of the container fleet a year ago, versus 1.5% today.”

Stefan Verberckmoes, analyst at Alphaliner, told Seatrade Maritime News: “You can certainly say that the Red Sea crisis has changed the dynamics for the industry. A lot of extra tonnage is needed and all newbuildings - and there are a lot of them currently - are immediately introduced in East West loops.”

In an effort to maintain services some carriers have offered ad hoc sailings using smaller tonnage to fill a gap in the scheduling. Maersk, CMA CGM, Hapag-Lloyd, HMM, Evergreen and Cosco have all deployed ships of between 1,800 and 6,000 teu and one 11,000 and one 20,000 teu ship, have all deployed vessels for this purpose. 2M has been the most successful alliance in maintaining its services with a slew of newbuildings being deployed into the alliance’s Asia to Europe services.

Although tonnage is currently tight, in what is the early stages of the diversion of tonnage around the Cape, Alphaliner acknowledges that with much more capacity to come the current situation remains fluid. “There is, however, more capacity under construction for delivery in 2024 and 2025 than is needed for Cape diversions,” said Verberckmoes. “We still feel that the market is heading for an overcapacity scenario, but the Red Sea crisis is just delaying this. As soon as the Suez routing is safe again, a lot of ships will become redundant.”

He added: “We also see that vessel scrapping, which was expected to significantly increase, has stayed at a low level as long as the Red Sea crisis looms.”