KUALA LUMPUR, April 18 — The supply of container vessels will continue to outpace demand, putting pressure on freight rates as more newly built containerships are introduced into the market amidst ongoing geopolitical conflicts.
Veson Nautical senior content analyst Rebecca Galanopoulos Jones said container values have risen significantly across almost all sectors and age categories since the start of the year.
“The increase in container values is largely due to the ongoing disruption in the Red Sea.
“By rerouting around the Cape of Good Hope, vessels are travelling longer distances, reducing available vessels and therefore pushing up rates,” she said in a statement.
She noted that container journeys transiting around the Cape of Good Hope have increased by nearly 200 per cent in the first quarter of this year (1Q 2024) versus 1Q 2023.
“Since January 2024, values have taken a turn in the opposite direction and older vessels have shown the most strength, with values for 20-year-old Handy Containers of 1,750 twenty-foot equivalent unit (TEU) up by as much as 43 per cent since the new year to US$8.6 million (RM41 million) from US$ 6.99 million,” said Jones.
The increase in values has been supported by climbing earnings since the start of the year.
“For example, in the Handysize sector, earnings have jumped by 39.4 per cent to US$12,940 per day today from US$9,280 per day on the first of January 2024,” she added. — Bernama
