- Freight rates fall for the 11th consecutive week, as demand weakens.
- Idle fleet hits 15-month high but charter market stays tight.
- October is seen as a turning point for drastic capacity cuts.
Linerlytica’s latest Market Pulse highlights a pressing issue: over the next four years, ship scrapping needs to match the total vessel demolitions of the past 25 years to restore balance in the market, reports Safety4Sea.
Freight Rates Continue 11-Week Slide
Spot freight rates have been on a downward trend for 11 consecutive weeks, and the hope for a September rebound is dwindling as carriers hold back on cutting capacity, even with demand weakening. In the last two weeks, cargo booking volumes have plummeted by 5–20%, especially on the Transpacific, Asia-Europe, and Latin America routes.
Idle Fleet Rises but Charter Market Remains Tight
The removal of 11 ships under U.S. sanctions has pushed the idle fleet to its highest level in 15 months. Yet, the charter market is still tight, with October potentially being a pivotal month when carriers might have to make significant capacity cuts to avoid a complete collapse in rates.
Intra-Asia Trade Proves More Resilient
Intra-Asia rates have shown more stability, with results for the first half of 2025 favouring carriers focused on this area. A shortage of charter tonnage and a limited order book for feeder ships have shielded this sector from the severe rate cuts impacting long-haul trades. However, there’s still uncertainty about whether this resilience can hold up through the end of the year.
Scrapping Activity Lags Far Behind Requirement
As of now in 2025, only 12 containerships, totalling a capacity of 8,465 teu, have been scrapped, with another six vessels either lost or repurposed. Despite these low scrapping levels, the real challenge lies ahead: at least 4.5 million TEU need to be removed by 2030, matching the capacity scrapped over the last 25 years.
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Source: Safety4Sea
