The expanded Panama Canal will be opened next year. Currently, 238 container vessels of 4,000-5,100 teu are using the Panama Canal. But, from next April these ships will be replaced by larger vessels of up to 13,000 teu. Similarly, the position of more than 200 Panamax containerships hangs fire. A total of 160 Panamax ships are currently sailing in the Asia–US East Coast trade, with 155 using the canal and the remaining five on services via Suez.
As per Alphaliner, the current 16 Asia-US East Coast loops operating via Panama will be reduced to 10, deploying ships of 6,000-10,000 teu. At least, four of the nine loops serving east coast ports via Suez are expected to switch to the shorter route of the Panama Canal. The sudden and short-notice upsizing of containerships puts pressure on ports as has been seen on the west coast. They receive fewer calls but larger exchanges, possibly straining landside operations and disrupting supply chains. The Panamax container ships’ owners have to find alternative trades for regular employment.
The average age of the Panamax containership fleet is only ten years, and 28 ships are over 20 years old on the verge of demolition, notes Alphaliner.
At the recent JOC conference in Hamburg, Alphaliner’s senior analyst told that Panamax vessel owners had hay day over the past ten years. At the peak period in 2005, they made a daily hire of some $45,000, which dropped to around $7,000 during the recession and rose back to over $25,000 in 2010/11.
The larger vessels had reduced their earning to less than $9,000 a day from 2012 until the latter part of last year when hire rates spiked at around $15,000. The saving grace was the US west coast labour dispute that caused the demand for extra ships to mitigate vessel delays. The desperate owners and ship managers will extend charter hire options on almost any terms this year as 85 Panamax containerships are due for redelivery within the next three months.
Source: The Loadstar
