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Boxship charter market cools

Boxship charter market cools
Activity in the containership charter market cooled last week, with charter rates remaining mainly flat as lines played a waiting game due to stagnating freight rates and the huge influx of capacity expected to come from new services.

Boxship charter market cools.

Brokers warn influx of new services may trigger rate-cutting.

Activity in the containership charter market cooled last week, with charter rates remaining mainly flat as lines played a waiting game due to stagnating freight rates and the huge influx of capacity expected to come from new services.

?It is very quiet; lines are taking a wait-and-see position,? a Hamburg broker said, adding that the lull in the charter market coincided with school holidays in the German city.

?A large amount of the box chartering activity is handled via Hamburg-based brokers, so this could also have an effect on the market,? he said.

However, the more important factor for lines" reluctance to fix new tonnage is the influx of fresh capacity, following the introduction of new services.

This has already sparked fears of a revival of cut-throat competition in the industry. OOIL chairman Tung Chee-Chen warned this week that an ?imprudent reintroduction of capacity? could trigger ?fresh rounds of rate cutting?.

Capacity on the liner trades will increase by a total of 785,000 teu over the first four months of the year due to reactivated vessels and newbuilding deliveries, according to analyst Alphaliner.

It considers the threat of price-cutting to be real as spot rates on the Far East- Europe trade have already fallen by $310 during the past two weeks. Alphaliner expects rates to decline further in the coming weeks, triggered by the new services.

However, there are also positive signs. Port throughput figures from the eight leading box ports showed a 22% increase for the January-February period compared with last year, it said.

Fixtures were scarce in nearly all segments but in the post-panamax segment, a deal for five 6,200 teu vessels stood out. According to brokers, NYK chartered back the NYK Castor, NYK Canopus, NYK Sirius, NYK Antares and NYK Andromeda, which it had sold to Zodiac Maritime for $19m each some weeks ago. NYK took the vessels for two years each at an undisclosed rate.

K Line chartered the 4,600 teu Northern Prelude for 70 days at a private rate ? 11,500 per day, according to brokers. The deal attracted brokers" interest as it was already the third trip in a row the vessel did for K Line. In November, the line paid a daily rate of $6,400. By accepting short employments, owner Norddeutsche Vermögen benefited from the rising market. ?Other owners chartered vessels out for 12 months at the same rate at that time,? a broker commented.

The mainly flat-rate development was reflected by several 1,700 teu boxships being chartered at rates of $4,600 per day ? the same level as deals done two weeks ago.

However, vessels that are scarce due to their specifications or equipment are still able to obtain comparatively high rates. As an example, Sinoline took 1,043 teu Dae Sun type Stadt Lauenburg for 12 months at a rate of $5,700 per day, which was above the rates for 2,500 teu vessels.

According to brokers, this type is in great demand due to its fuel efficiency and its size of just below 10,000 gt, which releases the ships from the obligation to use pilots in some regions. In addition, there are only about 30 vessels of this type around, one broker said.

German shipowner Laeisz managed to reactivate two vessels that have been in lay-up for seven and 13 months respectively. PIL chartered the 2,600 teu boxships Pommern and Potsdam for 12 months, with an option for an additional 12 months at a daily rate of $5,100.

www.turkishmaritime.com.tr

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