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Article: 13 million TEU of excess containers by 2023

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    13 million TEU of excess containers by 2023

    1 Comments by Shailesh Singh Published on 6th October 2022 06:24 AM
    Shipping disruption has resulted in an unprecedented expansion in the global container fleet. Congestion and longer transit delays have entangled more shipping containers than ever before. Over the last two years, supply chain congestion has resulted in considerable increases in-transit time. It is the case not just due to ocean-side delays but also interior congestion and delays.

    Alphaliner commented on the emerging agreement that supply chain problems would endure until 2022. The sale-and-purchase market for container boats has reached new highs due to optimism about the longevity of the shipping boom. "The number of container vessels changing hands reached an all-time high in 2021 after ship owners appeared willing to pay almost any price to secure tonnage," said Alphaliner, while noting that the growing consensus on longer market strength may justify [2021] purchases with delivery deferred to this year."

    According to Alphaliner, 572 container ships were sold last year, "equal to an astounding 1.94 million TEUs (twenty-foot equivalent units)." Ever since sales were inflated by the catastrophic collapse of ocean carrier Hanjin, they increased by 26 percent above the previous annual record set in 2017.
    According to Danny den Boer, director of worldwide sales and trade at SeaCube Containers, the world container fleet increased by 15% in 2021 to 51.4 million TEU, compared to a pre-Covid annual growth rate of 5%.

    "It's exceptional, caused by the severe disruptions in global supply chains," Mr Boer said. "But it was also because people shifted to spending on goods instead of services, which is also why we have seen a record number of newly produced dry units in the market."
    Mr Boer added: "The market is extremely volatile. We see softening demand and downward pressure on new and used shipping container prices. We see more units being disposed of into the secondary market in Asia."
    The bigger the problems in the supply chain, the greater the need for cargo containers. Conversely, as the issues reduce, there will also be a reduction in the need for more freight containers.

    To quantify those mentioned above, the Danish maritime data analysis company, Sea-Intelligence, evaluated the data given by Hapag-Lloyd in issue 564 of Sunday Spotlight and matched the volume of cargo moved and the equipment fleet over a longer timeframe. The caveat is that Hapag-Lloyd's operational success concerning their equipment is in use as a proxy for the overall market.
    Sea-Intelligence began its investigation by examining the evolution of the equipment fleet's size and the number of maritime containers moved during the previous 12 years. The equipment's efficiency measures per steel shipping container usage in moving the number of freight loads in the fleet.

    The efficacy of the equipment fleet remained reasonably consistent in 2010-2014, at 1.3 loads per container every quarter, before experiencing severe volatility in 2014-2017 and stabilising again at an average of 1.18 full loads per container in 2018-2019.
    In 2020-2022, the efficiency dropped dramatically to 0.95 loads per maritime shipping container. In the fourth quarter of 2021, the figure appears to increase somewhat to 0.98 in the first quarter of 2022.

    To transfer their cargo in the first quarter of 2022, Hapag-Lloyd required an equipment fleet of approximately 3 million TEU. Hapag-Lloyd will use 17% fewer steel freight containers in their equipment fleet if the industry addresses the supply chain bottlenecks. If this reflects the worldwide market, we would require 17% fewer cargo boxes than we presently have. Allowing for the 4.5-4.8 million more TEU to be delivered in 2022, we end up with 13 million TEU of excess containers in 2023, according to Sea-Intelligence.

    For more such updates, keep in touch with BOXXPORT, a leading online shipping container trader company. We offer easy selling and buying of metal shipping containers across the world. All you have to do is just register, sign up, and enjoy flexible container trading services 24x7.

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    Default Re: 13 million TEU of excess containers by 2023

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