Tuesday, November 19, 2013
Pending Container Shipping Chaos?
Look at what has and is happening. Three largest container lines are in an alliance. How will they fill ships? Now mega-ships with 18,000 TEU capacity. How will they fill ships? Despite announcements of rate increases, little sticks beyond some spot rates. Selling ships and leasing them back is a balance sheet accounting trick that looks good but does not change market dynamics. Supply of capacity exceeds demand. Are we looking at another round of laying up significant tonnage to bring stability and to increase rates, similar to 2009? Will the banks give them any choice but to do it?