Call them unreliable …
Here’s what the “recovery”looks like.
Item Number 1 – On February 6th, 2014, Drewry Shipping Consultants began its Carrier Performance Insight report with this headline – “Liner Reliability Set to Decline”, and the report reads as follows:
“Liner shipping is becoming less and less reliable as operators ignore service standards in the rush to cut costs. The bad news for shippers is that the situation is only going to get worse, according to Drewry’s newly published Carrier Performance Insight report.
“Containership reliability worsened in every quarter of 2013, with the fourth-quarter decline taking the on-time average below 64%; the lowest it has been for two years (61% in 3Q11). Compared to the same quarter in 2012 when the all trades average reached a peak of 75.2%, the fourth quarter result was down by a hugely disappointing 11.4. The weaker performance coincided with a raft of skipped voyages. With more planned for the first couple of months of 2014, the short-term outlook for reliability is not great.
“‘The focus on reliability seems to have been lost in the current cost-cutting environment. Shippers are now paying more for poorer services,’ said Simon Heaney, senior manager of supply chain research at Drewry.
“‘Shippers know that lines are saving money, so they will be unwilling to accept further rate increases.'” –
Item Number 2 – From Schednet on February 18th, 2014 – “Idle fleet exceeds last year’s level, despite early Chinese New Year”
“Idle container ships made up 3.2 percent of the world box fleet of 17 million TEU in the week of Feb. 3 with a total capacity of 547,834 TEU, having already totaled 2.9 percent the previous week. The world’s idle fleet is now at its highest level since mid-April last year when it hit 537,224 TEU, or 3.3 percent of the fleet, according to the latest figures from Lloyd’s List Intelligence. It now exceeds the figure for the like period in 2013 when the inactive fleet represented 3.1 percent of the total fleet.
“The increase in the size of the fleet comes as shipping lines have been blanking sailings and adjusting capacity in line with factory closures for the Chinese New Year, which started 10 days earlier than last year.
“In terms of the various vessel segments, the panamax fleet (3,000-4,999 TEU) once again had the most unemployed capacity, with a total of 173,980 TEU. Just behind the panamax segment was the post-panamax fleet, which had 150,457 TEU idle.” –
Item Number 3 – Also from Schednet on Feb. 18th, 2014 – “Newbuilding containership orders drop away as market becomes jittery.”
“A string of containership owners have abandoned newbuilding orders over the last few months that were placed when prices were high to reduce exposure to an uncertain market.
“Although some of the cancellations were due to problems at shipyards, such as an order for one 3,500-TEU ship at Rongcheng Shenfei that the Shipping Corporation of India (SCI) cancelled in September after the Chinese yard fell behind on delivery.
“SCI also has three 6,500-TEU ships on order at STX Dalian, whose deliveries have also fallen behind schedule after the Chinese yard failed to secure a new owner following the bankruptcy of the STX Group last year, reports Alphaliner.
“At least one of the 15 ships of 1,900-6,600-TEU on order at STX Dalian has been cancelled by owners after failing to meet delivery dates, and the fate of SCI’s remaining orders remain unclear.
“Paragon Shipping, managed by Athens-based Allseas Marine, cancelled in December one of two 4,777-TEU wide beam container vessels ordered in March 2011 from China’s Zhejiand Ouhua Shipbuilding. The company now has only one ship on order slated for delivery in the second quarter of this year, for which the contract price has been lowered from the original US $ 57.5 million to US $ 55 million.
“In January, Ship Finance International Ltd. (SFIL) walked away from taking delivery of the first of four 4,800-TEU wide-beam overpanamax container ships ordered from China’s Shanghai Shipyard in April 2011, with the backing of a seven-year charter to Hamburg-Sud. The ship, due to be delivered one year behind schedule, has since been bought by Hamburg Sud for $ 44 million, a bargain compared to the $ 55.7 million agreed by SFIL in 2011.
“The three sister vessels, which have incurred similar delays, are now gone, and have been bought recently by Hamburg Sud at a reported cut price of $ 41 million.
“Also in January, Greek owner Thenamaris reduced its exposure to the container shipping sector by getting rid of the Seaviolet and Seavelvet, two 4,896-TEU containerships ordered in March 2011 from China’s Zhejiang Ouhua Shipbuilding.
“The Seaviolet has been named Sapphire and taken over by a Hong Kong-based affiliate of the shipyard, Sapphire Shipping. The ship has been fixed to Maersk Line who is deploying her on its Far East-India (CHX) service. The ex-Seavelvet, due for delivery in March, is thought to be unfixed.
“Thenamaris is now left with only two 5,071 TEU, 2013-built, wide beam container vessels in its fleet, and both are on charter to Maersk Line.”-
[All of this stumbling and bumbling is the result of world-wide joblessness but maritime authorities still don’t understand that.]