LONDON shipbroker Braemar ACM notes that 12 vessels with a capacity of 36,000 TEU have been sold for demolition in the past 30 days, taking the year-to-date number to 30, for 52,000 TEU.
This compares with just 48 vessels for 88,000 TEU sent to breakers' yards last year, reports London's Loadstar.
With the IMO 2020 low-sulphur rule looming January 1, shipowners are keen to unload as many older vessels as possible, with the current high scrapping rates providing added incentive.
Braemar ACM reports on three recent demolition sales in the container sector: the 4,992-TEU 2004-built Piraeus, sold 'as is' in Singapore at $445/Ldt; the 2,020 TEU 1991-built MSC Pylos, sold for $450/Ldt; and the 1989-built 1,800 TEU Oriental Mutiara, sold for $468/Ldt, for delivery to Bangladesh.
The sale of the 15-year-old Piraeus is indicative of the overcapacity still prevalent in the panamax sector. Indeed, in its last idle tonnage report, Alphaliner said there were around 40 panamax vessels looking for employment, and the situation "remains worrying for owners".
Panamax vessels had a temporary reprieve last year as strong demand doubled daily hire rates to around $10,000, but rates have since fallen back to around $8,500 and, with the large number of ships on the spot market chasing cargo, look likely to fall further.
"Some owners have started addressing the oversupply issue by scrapping tonnage," said the consultant.