Archives for category: shipping intelligence weekly

Since remote antiquity the essential importance of energy to human civilization has been well appreciated: in ancient Greek mythology for example, it was the secret of fire that the Titan Prometheus stole from the gods and gifted to mankind. Today the still increasing energy needs of humanity are greater and more diverse than ever before. And in this energy tale, shipping of course plays a titanic role…

For the full version of this article, please go to Shipping Intelligence Network.

 

Advertisements

The world of seaborne trade spreads across a wide range of commodities and goods. But in terms of growth, at any point in time some elements look overweight or underweight compared to their share of trade in total. And once distance by sea comes into the equation, things can be even more complex. This week’s Analysis examines the tale of the scales since the downturn of 2009.

 

For the full version of this article, please go to Shipping Intelligence Network.

British cycling star Chris Froome has taken on one long cycle after another, currently tackling the Tour Of Spain following his fourth Tour De France victory back in July. Two long cycles are ongoing in the shipbuilding sector too, and this week’s Analysis takes a look at the progress of the delivery cycles in the merchant vessel and mobile offshore sectors, through a challenging period for the industry.

For the full version of this article, please go to Shipping Intelligence Network.

Container shipping is often thought of as the ‘glue’ which keeps the world economy turning, providing a low unit cost way of moving both manufactures and a range of other goods between producers and consumers around the world. As such, container ports and terminals are crucial nodes in the world’s transportation system, and their sheer number and ubiquity merits a close look.

For the full version of this article, please go to Shipping Intelligence Network.

The development of the global merchant fleet is affected by a very broad range of interwoven supply and demand factors, including shipping and commodity cycles, investor sentiment, regulatory concerns, yard capacity and so on. Another factor is shore-side infrastructure projects, which can be tricky to disentangle from the wider web, though this influence is a little clearer on, for example, the LNG carrier sector…

For the full version of this article, please go to Shipping Intelligence Network.

The Wall Street Crash in 1929 marked the onset of the Great Depression in the US. Times were tough, but jazz music, which had taken off in the 1920s, endured and evolved into the era of big bands and swing music now synonymous with the 1930s. The crude tanker sector is having a tricky time of its own at present, but over the last decade, crude trade patterns have seen their own evolutionary swing…

For the full version of this article, please go to Shipping Intelligence Network.

It is over a year now since the opening of the new, expanded locks at the Panama Canal. The new locks have had a significant impact on a number of areas of shipping, including the gas carrier sector, but the main focus of the project in Panama was always the container trade, and the Asia-US East Coast route in particular. In that regard, how do things look a little over one year on?

Old For New

The new locks at the Panama Canal opened for transit on 26th June 2016, and the impact on the box shipping sector has been largely in line with expectations. The key area of impact was always going to be the Transpacific trade, and the Asia-US East Coast route in particular, the largest volume trade through the canal. Following the opening, the Asia-USEC route immediately saw swift upsizing of ‘Old Panamax’ containerships, being replaced by ‘Neo-Panamax’ units, with operators aiming to benefit from the economies of scale offered by running larger vessels through the canal. Regular deployment of ‘Old Panamaxes’ on the Asia-USEC route via the canal has fallen from 156 units in June 2016 to 30 today.

The total of ‘Old Panamaxes’ on the broader Transpacific trade now stands at 76, including some still operated via Suez to the USEC and from Asia to the USWC. However, there are around 35 ‘Old Panamaxes’ idle, and in total (based on a wide definition of 3,000+ TEU and ‘Old Panamax’ beam) 101 have been scrapped since start 2016. Having said all that, there are still many of these units deployed elsewhere, with, on the same definition, over 450 outside the Transpacific.

Bigging It Up

Looking upwards, the initial impact last summer was a speedy upsizing of tonnage to ‘Neo-Panamaxes’. This, as expected, basically jumped the class of sub-8,000 TEU ‘wide beam’ ships; just 22 of those serve Asia-USEC today. Instead it focussed immediately on the 8-11,999 TEU ships, and today there are 93 of those deployed on the Asia-USEC. And now even units as large as 12,000+ TEU are getting in on the act, with 9 deployed Asia-USEC, taking total deployment of new ‘wider beam’ units there to 124.

Switching Off?

This is all against a backdrop of robust growth on the Transpacific, with peak leg eastbound trade up by 8% y-o-y in Jan-May 2017. However, there hasn’t been any early sign of ‘cargo switching’ with flows proving ‘sticky’, even if USEC infrastructure constraints are diminishing (lifts at the 5 leading USEC ports as a share of lifts at the 5 major USWC ports is steady at c.80%). And interestingly the additional capacity on the Asia-USEC trade from the surge in upsizing has eroded the average Asia-USEC/Asia-USWC spot box freight rate ‘premium’ only gently, from 94% in 1H 2016 to 76% in 1H 2017.

More Time Required?

So, plenty of questions remain. Will the Panamaxes finally fully depart the trade? Will a ‘cargo switch’ eventually evolve? How will the freight market trend? One year may have passed but it appears more time is needed to assess in full the longer-term impact of the new Panama locks on box shipping. Have a nice day.

Graph of the week