Drewry’s analysis reveals a 1 per cent growth in the global container fleet in the past year, reaching 51.4 million twenty-foot equivalent units (TEU). This growth was primarily fuelled by a surge in newbuild output towards the year’s end, reversing earlier declines in inventory levels. Looking ahead to 2024, Drewry has upgraded its fleet growth projection to 2.3 per cent, driven by increased trade activity and decreased box productivity.
The slowdown in container turnover is largely attributed to ongoing draught restrictions in the Panama Canal and the rerouting of ships originally transiting through the Suez Canal. These measures have been taken in response to attacks on vessels in the Red Sea by Houthi rebels, prompting ocean carriers to opt for longer routes around the Cape of Good Hope.
The global shipping container fleet has experienced a 1 per cent increase, reaching 51.4 million TEU, with expectations of a 2.3 per cent growth in 2024.
This growth is attributed to rising trade and disruptions in crucial maritime routes, including the Red Sea and Panama Canal.
These disruptions have led to longer voyage times and inventory challenges.
This shift has led to containers spending more time at sea and delays in completing their journeys, slowing sales in the secondary market and depleting the stock of empty containers, particularly in China. The maritime industry’s vulnerabilities to geopolitical events and operational challenges have been starkly highlighted, affecting major trade routes.
January statistics showed a significant increase in containership transits around the Cape, with 605 recorded, up from 164 the previous year. Conversely, voyages through the Suez Canal fell to 62 from 328 in January 2023. The diversion to the Cape route can add between 10 to 15 days to voyage times, depending on the destination.
In addressing the disruptions at the Panama Canal, affecting Asia-US East Coast trade, carriers have explored various strategies, including land-bridging via the Panama Canal railway and rerouting via the Cape of Good Hope. The incidents have impacted an estimated six to seven million TEU.
Amid these challenges, Chinese manufacturers lowered prices for new containers in late 2023 to stimulate orders, with 20ft container prices dropping to around $1,850. This price reduction led to a strong uptick in orders, primarily from ocean carriers, benefiting from the increased production capacity.
Drewry forecasts a stronger 2024 for the container trade, with global container handling throughput expected to rise by 2.3 per cent, a significant improvement over the minimal growth observed in 2023. Additionally, ocean carriers are likely to enhance their box-to-slot ratios in the short term, building up buffer stocks to navigate the ongoing supply chain disruptions effectively.
Fibre2Fashion News Desk (DP)
