Chartering activity has been holding up over the last couple of weeks,
with a bit more action returning to the very large sectors. Feeder tonnage
in Europe continues to achieve firm rates.
The impact of Lunar New Year with its factory and office closures in China on the container ship charter market[ds_preview] seems not to have been as severe as in previous years. Shipbrokers continued to record fairly high activity in terms of fixtures and extensions in the first half of February, with tonnage availability in Asia still at very high levels, though. By contrast, the Atlantic basin and the Mediterranean remain short on spot tonnage in many sectors, prompting charterers to fix vessels off positions in Asia. Meanwhile period rate levels remain on a sideways trend since stabilising at low levels during January, which is illustrated by a marginal month-on-month increase in the ConTex.
The index suggests that a slightly firmer trend is already under way for the feeder class segment, with the 12 month period assessment for geared 1,100TEU’s even improving by a few percentage points to over 6,800$ in recent weeks. The gains have been driven by a firming market in the Atlantic where »charterers must expect to pay more than last done for vessels with good specifications,« as one Hamburg-based broker pointed out. In the Mediterranean, Sea Consortium is reported to have extended its charter of the geared 1,138TEU »AHS St. Georg« (built 1998) for five to seven months at 7,250$ per day while in North Europe a couple of gearless 1,000TEU vessels secured medium to long term employment with operators Unifeeder and MSC affiliate WEC Lines at stable levels of 7,750€. Of note, there are apparently more 12 month period durations getting fixed which underlines growing concerns over the supply of tonnage oing forward.
Over in the Caribbean, the geared 1,118TEU »Vega Zeta« obtained 7,500 $ per day in a short term extension with Sea Consortium while the brandnew fuel-efficient geared 1,102TEU »Toronto Trader« joined Crowley for a 12 month period at a premium hire rate of 9,000$ per day.
The newly-introduced container feeder ship index (CFix) by Hamburg’s Ernst Russ Shipbroker registered a slight 1.6% decline in fixing levels for small tonnage during January. However, rates remain at much improved levels compared with this time last year (+32.3% year-on-year) as the smaller sectors kept bucking the downward trend for the rest of the market during the second half of 2015. »In general chartering activity started early and has been higher than in January last year. In addition to new fixtures and extensions, options on most vessels have been declared,« Ernst Russ commented. The shortage of vessels on the north continent sparked an increase in ballasting of spot vessels from other areas into North Europe, it explained. Paris-based Alphaliner also highlighted the firmer outlook and forthcoming opportunities for period rate improvements due to tight availability, saying that it counts »barely 15 vessels (of 1,000–1,200TEU) available worldwide«.
The other striking development of recent weeks was the return of fixing activity in the very large container ship segments above 7,500TEU which brokers interpreted as a sign of greater confidence in cargo volumes post Chinese New Year. Maersk, MSC, Wan Hai, Yang Ming and PIL were all busy fixing or extending vessels, chiefly for transpacific, Europe-India and for Far East/Middle East trading. While MSC is reported to be paying only 6,000$ per day for straight 12 month periods on the 7,847TEU »E.R. Yokohama« and »E.R. Seattle«, larger units such as the 8,533TEU »E.R. Tianan« as well as a couple of Northern J type vessels found employment at rates around 8,000$ per day. The latest surge in demand led to a drop in spot tonnage availability in the 8,000–9,000TEU sector from 14 to six units, according to Alphaliner. On the other hand, a group of six major lines (MSC, Hapag-Lloyd etc.) just announced a restructuring of their Asia-East Coast South America service offering, effectively reducing the number of loops from four to three. Unless the carriers find alternative deployments for the surplus string of vessels elsewhere in their networks, excess vessel capacity in the 8,000–9,000TEU segment may increase again.
Michael Hollmann
