Wednesday, February 18, 2009

When will container shipping rebound?

Not until 2011 or later.

Currently 8.8% of the worldwide container fleet is laid up.

It will most certainly get worse before it gets better. If we are lucky, maybe by 2012 - that's 3 years, but the cycle for shipping is normally around 7-10 years, so my guess is not really until 2016 plus.

More ships likely will be laid up as the rebound in Chinese exports failed to materialize after the Lunar New Year. As a result, shipments likely will fall by 15 to 20 percent in the first quarter compared with a year earlier. “Large ships continue to gather up in Asian roads as they end their rotations on the closed services on which they were employed,” AXS-Alphaliner said.

It said container traffic must grow at annual rate of 15 percent for three years to bring the supply-demand balance into equilibrium by January 2013.

A less optimistic but more reasonable average 10 percent annual growth would delay a return to equilibrium before 2014.


click here for complete article from Journal of Commerce.

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