Alphaliner at Intermodal Europe 2023
Alphaliner, pioneer and leading provider of in-depth analysis to the liner shipping industry, combined with advanced solutions for liner shipping professionals, participated in the opening Global Market Outlook Panel on Day One at Intermodal Europe 2023. The event is a world-class exhibition and conference for companies associated with the container and intermodal industries, covering all areas of container shipping and logistics.
In his talk, Stefan Verberckmoes, Senior Analyst at AXSMarine (Alphaliner), confirmed that ‘green transition’ of the container fleet is gaining traction.
Undeterred by an increasingly gloomy outlook and the specter of structural overcapacity that appears on the horizon, carriers have continued to place orders for new container tonnage throughout the year.
In the first nine months of 2023 alone, another 187 vessels have been added to the global new building pipeline. Predominantly ordered by the carriers themselves rather than by tonnage providers, these ships represent some 1.75 Mteu of additional fleet capacity.
There are two obvious reasons why ordering continues at such as massive scale: firstly, most carriers are still sitting on large amounts of cash after having made record profits in the wake of the COVID-19 pandemic.
Secondly, and more importantly, it is the desire to carbonize liner shipping that drives the ordering frenzy. Methanol-powered ships represented 52% of all new capacity ordered this year, while LNG-powered new buildings accounted for 31% of the 2023 orders, bringing the total share of ‘green’ ships to 83%.
"There is currently only one methanol-powered vessel in service – the 2,136 teu LAURA MAERSK – but the order book already counts 139 methanol dual fuel box vessels, Stefan said. "The decarbonization challenge will be moving from the vessel to the strategic procurement of sustainable fuels.”
Stefan ended his view on the global market outlook with a reference to the financing of the ‘green transition’. The record profits realized by the carriers during the COVID-19 pandemic have allowed the investment in ships, but the alternative fuels will come at a high price which needs to be charged to the customers.
Ocean freight rates are always under high pressure in times of overcapacity. By ordering many ‘green’ ships, even more capacity will be delivered. Carriers will face an enormous challenge to increase their rates to compensate for the higher bunker costs.
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