Indian Transport & Logistics

Container shipping nears turning point: Container xChange

Carriers adopt slow steaming to manage tonnage; cost of moving empty containers, especially to Asia, remains significant

Container shipping nears turning point: Container xChange
Listen to this Article

While there is optimism for a recovery in container shipping, the overall rates of growth are anticipated to remain lower compared to previous decades, according to experts who participated in the Digital Container Summit (DCS) 2023 organised by Container xChange.

Industry experts like Peter Sand, Xeneta, Antonia Ambrozy, Freightos, John Fossey, Drewry, Nick Saavides, Loadstar, Supal Shah, Arcon Container, Jack Sun, Orange Container Line, Danny den Boer, SeaCube and Stefan Verberckmoes, Alphaliner/AXSMarine participated in the two-day event.

"The supply side of the equation revealed that the global fleet of container ships is set for expansion in 2023 and beyond. Projections indicate that by the end of 2025, the industry will boast an impressive 30 million TEU slots in service. Vessel slot capacity growth, a crucial factor, witnessed a 4.5 percent increase in 2022 and is forecasted to expand by 5 percent in 2023 and further by 6.3 percent in 2024," says an official release.

Despite the prevailing slowdown in trade, the interest in ordering new ships has remained unwavering, the release added. "Over 80 percent of vessel orders placed in 2023 have been for dual-fuel tonnage with a substantial number targeting neo-panamax vessels." The historically low rate of scrapping in recent years is set to change, signifying a significant shift in the industry, experts added.

Drewry anticipates a dip in the pool of container equipment this year from 50.9 million TEU to 49.9 million TEU, followed by an upward trajectory leading up to 2025 where 53.5 million TEU is anticipated to be in service.

“The container shipping industry is facing a turning point with both challenges and chances," says Chrisitan Roeloffs, CEO & Co- Founder, Container xChange. "Trade growth is slowing down, and this year, we only expect a tiny 0.3 percent increase. There are uncertainties related to the economy and politics that are affecting the market. Also, the container shipping business is getting more stable and closely connected to changes in the economy. But there's some hope on the horizon - the expected increase in the space available on ships in the next three years might help balance supply and demand by 2025."

Experts at DSC 2023 emphasised that MSC, a key player, might be required to commit further volumes as part of the agreement.

"MSC has also pledged to enhance its volume throughput at Hamburg, targeting a remarkable one million TEU by 2031, alongside relocating its German headquarters to the city. This strategic partnership aims to fortify the entire Port of Hamburg, positioning it as a central hub within MSC's global network of container services and logistics chains."

Sand says: "MSC will surely have to commit further volumes as part of the agreement, but the city will benefit from the injection of cash. This move aligns with MSC's strategy of operating efficiently from port to port."

Read Full Article
Next Story
Share it