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Large Vessel Demand Rises as Boxships Queuing for Scrubber Retrofits

Large Vessel Demand Rises as Boxships Queuing for Scrubber Retrofits
More than 100 containerships aggregating 950,000 TEUs were in yards for scrubber retrofits last month before the International Maritime Organization (IMO) sulphur cap entered into force on January 1, 2020, according to Alphaliner.

Many of these retrofits combined routine dry dockings for planned maintenance and classification surveys deadlines.

Even after the deduction of the routine maintenance/class work component, the scrubber retrofits have been freezing the equivalent of 90 standard ships of 8,500 TEU, the shipping analyst estimated.

Furthermore, another 15 ships totaling 130,000 TEUs were lying at anchor in December while awaiting their yard slots as retrofits have been plagued by delays due in particular to a lack of trained manpower and of yard capacity.

As a result, the IMO 2020 regulation and their consequences have become a major driver for the charter market, Alphaliner explained. This was driven by two main factors — the need to find substitute ships to fill the gaps left by vessels immobilized for scrubber retrofits and the vessel scarcity created by this extra demand has boosted charter rates.

On the other hand, the long line of boxships waiting to enter repair yards for the installation of scrubbers with extended yard stays are coasting shipowners dearly in vessel downtime. Among the top twelve carriers, Mediterranean Shipping Company (MSC) has been the most badly affected by the retrofit delays, with at least 15 vessels clocking yard stays of over 80 days, Alphaliner’s data showed.

At the end of 2019, ships with exhaust gas cleaning systems reportedly accounted for some 5.9% of the total number of containerships or 11.8% of the total TEU capacity of the fleet.

As informed, more scrubber fitted containerships are expected to be delivered in the next two years, including both newbuildings and retrofitted units, that could possibly bring their total number to some 1,000 ships for 10 million TEU by the end of 2022.

 

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