The contracting of new ships has slowed since its record in 2021 but has remained twice as high as during the 2010s, according to an update by international shipping association Bimco.
The 1.3 million TEUs contracted so far this year had kept the order book high, only 3 000 TEUs short of the record 7.6m reached in March 2023, Bimco said on Thursday.
“The order book is in fact so large that ship deliveries are expected to exceed the previous full-year record of 1.7m TEUs three years in a row. Based on current estimated delivery dates, a total of 2.4, 2.9, and 1.9m TEUs are expected to be delivered in 2023, 2024 and 2025 respectively,” Bimco said.
Recycling of ships is also expected to increase in the coming years. More energy-efficient ships will replace less efficient ones as owners aim to reduce greenhouse gas emissions.
“Deliveries of new container ships during the first seven months of the year reached a new record high of 1.2m TEUs in 2023, beating the previous record by 0.2m. As recycling of ships has remained low, the fleet capacity has grown 4.3% since January,” said Bimco chief shipping analyst Niels Rasmussen.
Despite recycling of older ships, the fleet is still expected to grow by approximately 4.5m TEUs between early 2023 and early 2025, increasing the fleet capacity by nearly 18%.
The increase comes at a time when current trade growth in many key regions is declining and global economic growth prospects for the coming years are weakening.
According to Container Trades Statistics, total global container volumes during the first half of 2023 fell 4.3% year-on-year (y-o-y) and ended only 0.2% higher than during the first half of 2019. The all-important headhaul and regional trade lanes fell a combined 4.9% y-o-y but remained 3.1% higher than during the first half of 2019.
Headhaul and regional trade lanes improved in the second quarter as volumes fell 2.0% y-o-y and were 5.3% higher than in 2019.
Highlighting the current time charter and freight rate market weakness, headhaul and regional trade volumes have grown 5.3% compared to Q2 2019, while fleet capacity has grown 17%.
Future supply growth may be tempered by reduced sailing speeds, but further fleet capacity growth of about 15% in the coming year and a half underlines how supply-side growth will remain a challenge for shipowners and operators.