Steady demand in the second hand market has saved some of the older container ships from the breaking yard, including tonnage initially intended to be sold to scrap buyers, but eventually acquired for further trading as the charter market staged a mini recovery earlier this year, according to shipping industry analyst Alphaliner.
The total capacity of container ships scrapped from January to August this year has fallen to only 95,000 TEU, compared to 323,000 TEU in the corresponding period of 2014.
Only 54 cellular container ships have been scrapped so far this year, with an average size of 1,765 TEU and average age of 23 years. By contrast, a total of 130 ships were scrapped in the first eight months of last year, with an average size of 2,505 TEU at 22 years.
The fall in scrapping figures is also related to tumbling scrap prices, down from a high of USD 500 per light displacement ton (ldt) last year to only USD 320/ldt currently, while average charter rates are 30% higher so far this year.
Illustrating this trend, of the 16 Hapag-Lloyd container ships (dubbed ‘Old Ladies’) that the company announced it was planning to dispose earlier this year, only five were actually sold for scrap. The remaining 11 vessels were acquired for further trading. This included nine units aged 20 years or more, reflecting the continued market demand for older tonnage.