Deliveries of TEU container ship capacity have hit a record one million for the first four months of the year, according to research by Bimco.
In 2023, 2.3 million TEUs of vessel capacity were delivered, beating the former all-time high by 37%. Year-to-date, more than one million TEUs have already been delivered, an increase of nearly 80% compared to the previous record.
As ship recycling has so far only retired 19 smaller ships, the fleet has expanded by nearly one million TEUs, a 3.5% increase compared to the beginning of the year. This adds to last year's fleet growth of 8.2%.
Thanks to the rerouting of ships via the Cape of Good Hope following attacks in the Red Sea by Houthis, about 10% more capacity is needed to manage global container trades. Capacity needed to manage any market growth should be added to those 10%, according to the analysis.
However, when ships start increasing sailings via the Red Sea and the Suez Canal, the significant oversupply will become evident. Between 2019 and 2023, the fleet grew 21% while container volumes only grew 4%. Between 2023 and 2025, the fleet is expected to grow another 15%.
Due to record deliveries, the order book has declined, says Bimco. However, as 1.8 million TEUs have been contracted during 2023 and 2024, it has only declined by one million TEUs and now stands at 6.1m TEUs, 21% of the current fleet size. As a result, the order book’s share of the fleet is more than twice the size of what it was before the Covid pandemic and liner operators’ contracting spree began.
The order book contains two million TEUs for delivery in 2024 and delivery volumes for the year are on target to exceed three million TEUs, 30% higher than last year’s record. In 2025, deliveries should end just below two million TEUs, the third-highest deliveries in one year, only exceeded in 2023 and 2024.
But putting it into perspective, despite the growth, deliveries are still some way off the record when seen in relation to the size of the fleet. “In 2024, we expect deliveries to reach 11% of fleet capacity at the beginning of the year. That was most recently beaten in 2008 when deliveries made up 14% of the fleet,” a Bimco analyst said.
“The record high ship deliveries were expected to create significant oversupply in the market, and while this did impact the market in 2023, it appears that deliveries this year instead contribute to keeping global container trade moving.”
