Container ship rents hit 12-year high!

Container ship rents are at their highest level in 12 years at the end of 2020 and show no signs of slowing in the coming weeks.

Clarksons Research says the container ship leasing revenue index ended 2020 3 percent higher than it did in 2019.

Fearnley Securities, a Norwegian investment bank, also said demand was still outstripping supply at this stage.There is little sign of the market stopping its rally.

Over the past week, all segments of the container ship market have seen gains.

12-month rental rates for classic Panamax container ships are now set at more than $25,000, and rates for container ships between 6,000 and 9,000 TEU are rising.Fearnley Securities adds that growth in feeder transportation continues, with annual rents for a standard 1,700TEU unit approaching $18,000.

Freight rates are at an all-time high

In terms of freight rates, the Shanghai Export Container Freight Index (SCFI) reached an all-time high of 2,783 points at the end of 2020 and was 56 per cent higher than in 2019, Clarkson said.

Fearnley Securities said the SCFI index rose more slowly in the week ended Jan. 15 than in previous weeks, with the index up 0.5%.Trans-Pacific rates edged up 1 per cent, while Asia-Europe rates fell slightly after rising 40 per cent in the past month alone.

Trevor Crowe, an analyst at Clarkson, said: Second-hand container ship prices, which fell in the first half of the year, saw some sharp rises in the second half, with the overall price index up 14 per cent.While capacity management by shipowners (grounding, suspension of service, idling) has provided initial support to ease freight pressure, the main driver of the sharp rise in volatility has been the recovery in trade volumes.

In 2020, the volume of global container trade will decline by about 1.9%, better than expected at the beginning of the year.But that figure does not fully capture the magnitude of the dramatic change over a 12-month period.

In the second quarter of 2020, container shipping volumes were down 10 per cent from 2019, but increased significantly in the second half of the year as economies released pent-up demand, restocked and stocked in some areas, and shipped protective equipment to health workers fighting the epidemic.

"Green" and "tech"

Shipping orders fell to a new low of 8 per cent in October, but as order volumes picked up, they had fallen to 10 per cent by the end of the year, Mr Clarkson said.These slower production rates and the delivery of environmentally friendly ships have helped reduce emissions from container ships to about 40 per cent of 2008 levels.New ships capable of running on alternative fuels currently account for 21 per cent of orders.

Trevor Crowe said: "' Green 'and' technology 'will be a key part of the post-Covid-19 container ship operators' and owners' plans. Despite the uncertainty surrounding the Covid-19 outbreak, they will be entering a unique year in 2021, where future market development will require more rational planning."