Affected by multiple factors such as geopolitical situation, early peak season and capacity bottlenecks, the idle volume of container ships has fallen to the lowest level since the epidemic, while port congestion has hit an 18-month high.
According to the latest data from Alphaliner, as global demand for container ship capacity continues to soar, the number of idle ships has fallen to a low level not seen since the epidemic. In the first half of this year, commercial idle tonnage accounted for only 0.7% of the container fleet, which is similar to the level during the epidemic. This is equivalent to about 210,000 TEUs of the 29.6 million TEU global container fleet, which is consistent with the data recorded in the first half of 2022.
Specifically, there are currently 77 ships with a total capacity of 217,038 TEUs in idle status. As shipping companies continue to seek any available ships to maintain service, none of them exceeds 18,000 TEUs, and only two exceed 12,500 TEUs.
Stanley Smulders, ONE's marketing and commercial director, previously said: "If you look at all the statistics, there are no idle ships. Every ship is actually working and all shipping companies need ships at the moment."
Freight forwarder Flexport warned in its latest freight market update that the surge in spot freight rates will continue until the supply of capacity exceeds demand.
Lasse Daene, senior manager of ocean freight for Flexport North Germany, added: "Unfortunately, the development of the spot market has an impact on the long-term market. Currently, long-term freight rates are lower than spot freight rates, so shipping companies try to limit the supply of capacity for long-term agreements and use peak season surcharges to bridge the gap. This situation will continue until structural supply exceeds demand and loading rates in Asia begin to decrease."
Alphaliner pointed out that as ships above 4,000 TEU become increasingly scarce, the number of front-end fixed large ships expected to be delivered later this year and next year has increased significantly. Although the current surge in demand is largely driven by short-term factors such as the Cape of Good Hope detour and early peak season freight, this reflects that shipping companies believe that the Suez route is unlikely to recover in the short term. In addition, despite numerous geopolitical challenges, the global economy performed better than expected, resulting in higher-than-expected freight volumes, which also explains some confidence among shipping companies.
The detour around Africa has significantly increased the demand for TEU miles in the container shipping market, but one of the "costs" is the congestion problem at major ports.