The container market is on fire, according to Braemar which outlines the combination of geopolitical upheaval and market economics that is driving parts of the charter market ever upwards, with every sector in the broker’s index on the up, reports Marine Insight.
Braemar’s Monday Briefing note, for 10 June, suggested that charter periods are becoming longer, even for feeder vessels of under 2,000 TEU, that were lagging behind the larger sized vessels, while the same report pointing to rumors of a “batch of 3,500 TEU vessels”, available in the next few months with new charters.
Those rumours may have been about Hapag-Lloyd which Alphaliner reports has fixed seven ships of up to 3,000 TEU.
It is a theme that Braemar has also looked at, reporting that the mid-size sector of 4,000-9,999 TEU has seen significant under-investment in recent years with virtually no new buildings between 2016-2021.
These mid-sized vessels are also seeing increases in prices and extensions to the charter periods.
According to Braemar, the Red Sea diversions, which have caused delays and congestion due to the longer transit times, have also led to an empty equipment squeeze, pushing spot rates to new highs.
Those elements have been added to by the earlier-than-expected onset of peak season, through May-June, creating extraordinary demand as warehouses are being front-loaded to avoid supply chain snarls.
Carriers wanting charters to feed East Mediterranean destinations, which can no longer be served with ships through Suez due to the Gaza conflict, are competing for ships with new services operating on the booming Pacific trade to the US West Coast.
According to Sand, carriers are eager to return vessels to Asia to pick up the high-paying cargo, but the carriers are learning lessons from the Covid debacle, where boxes were dropped anywhere in the rush back to the Far East, and are also moving empties so that they can maintain the flow of cargo.
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Source: Container News
