11 August 2016

Panamaxes rapidly becoming Alangamaxes

When someone asked on Twitter recently what panamaxes should be called in the wake of the opening of the expanded Panama Canal last Sunday, one wag replied: “Scrap”, leading to others to suggest the new name for the panamax should be the Alangamax, a nod to India’s centre of ship demolition in Gujarat.

The jesting name might have merit however with news today from shipping association Bimco that demolition of panamax containerships in particular in the first five months has been dramatic.

Demolition of containerships almost tripled in the first five months of 2016 in comparison to the same period of 2015.

The demolition of capacity in the panamax segment (3,000 to 5,999 teu), since the start of January 2016 till the year to date, has been especially significant, Bimco noted. A total of 150,863 teu of panamax ships have been demolished so far in 2016, this equals the number of the same type of ship scrapped from June 2014 up to and including December 2015.

Time charter rates for the panamax box segment have slumped 63.5% from a monthly average of $15,800 per day in March 2015 to a monthly average of $5,755 per day today.

“One possible explanation behind the higher demolition in the panamax segment since January 2016 is their potential redundancy – due to the opening of the new locks of the Panama Canal,” Bimco said in a release.

Chief analyst Peter Sand said Bimco is raising its forecast for containership demolition from 250,000 teu to 400,000 teu for the whole of 2016. Sand was adamant that more needs to be done to lift the charter market.

Source: splash247. 1 July 2016

No comments: