Demand is strong across the board, with the two shipping giants, MSC and CMA CGM, active on all fronts, including the trading market.

Meanwhile, charter rates are rising sharply for all vessel sizes. This is reflected in the Alphaliner Charter Index (ACI) which is now, for the first time since june 2022, on a modest but visible upward trend, although its current level is still well below the all-time high of march 2022.

The benchmark rate for units of around 10,000 TEUs is so far US$44,250 for 24 months or US$33,000 for 36 months.

The positive developments seen in the market contrast with the current difficult environment, characterized by low spot freight rates on most routes and increasing pressure on the supply side, with record newbuilding tonnage capacity delivered in march. The slow rebound in cargo volumes from China and the brutal spike in oil prices meanwhile exacerbate current market concerns.

Alphaliner believes that the pressure exerted by the continued influx of newbuildings will inevitably take its toll on the market in the coming months, with a ripple effect affecting most vessel sizes. Meanwhile, stagnant demolition sales (after a very strong start to the year) are not helping to mitigate the growing risks of overcapacity, while it is still unclear how much additional tonnage demand the CII regulation is actually generating.

Following the conclusion of a couple of contracts during the first half of march, the last two weeks have been quiet in the VLCS segment (7,500-11,000 TEUs), with no new leasing deals closed. The lack of activity is mainly due to the continuing shortage of vessels.

Sub-leasing to the rescue of the 3,000-3,800 TEU segment

The depleted 3,000-3,800 TEU segment is experiencing a contraction in activity due to the shortage of vessels, but subleased tonnage is coming to the rescue of the greediest shipping lines.

Translated by: A.M