56 container ships scrapped during 2018

The Taiwanese shipping company Evergreen has already sold five container ships to scrap yards this year, including two ships of 5.364 teu. During the first six weeks of 2019, Evergreen sold almost half as much tonnage as the whole last year.

Last year only 56 container ships were scrapped. Their average age was 24years old. All vessels together totalled a capacity of 102.308 TEU, In January and the first week of February, 23 container ships were already sold to scrap yards with a total capacity of 47.000 TEU.

They expect that in the coming months more carriers will decide to scrap older tonnages. The limitation of sulphur emissions applicable as from January 1st 2020 will make some of the older vessels with a high bunker consumption, unprofitable.

Positive effect on over capacity

Since October last year that ships there is a trend that vessels with a capacity of more than 4.000 TEU are sold for demolition. If this tendency still continues as expected, this will have a slight but positive effect on the unemployed fleet and the overcapacity which the liner shipping industry has been struggling with for about ten years.

Evergreen has sold the majority of ships for demolition for the current year. The 5.364 large “ Ever Ultra” is currently sailing his last voyage to a wrecking beach in Chittagong (Bangladesh).

Also its sister ship ‘ Ever Union’ from 1997, which is still active between China and the Indian Subcontinent, will soon be waiting the same fate. The Taiwanese shipping company also sold three smaller ships of 1,164 TEU after 22 years of service.

High demolition prices

Carriers selling ships now, benefit from relatively high scrap pricing. The Israeli shipping company Zim just sold the panama vessel type  ‘Zim Virginia’ of 4,922 TEU which was taken into service in 2002, and received no less than $ 466 per ldt (light displacement tonnage). Two years ago the scrap prices still fluctuated around 300 dollars per ldt.

Both Maersk and MSC already scrapped one ship each year out of their fleet this year. For the Danish carrier it was the ‘Thomas Maersk’ of 1,594 TEU, which was delivered in 1994 and in past years mainly operated between Algeciras and West Africa. MSC said farewell to the ‘MSC Mirella’ of 2,152 TEU, which came into service thirty years ago.

Largest vessel demolished having 6.078 TEU capacity

The largest container ship that was sold for demolition in 2019 is the ‘Conti Basel’ of 6.078 TEU that has arrived in Chittagong on 24 January. This ship from NSB  Niederelbe Schiffahrts entered into service during 2003 and served for Hanjin under the name ‘Hanjin Basel’ for more than 10 years. After the charter, the German owner managed to rent this ship out to, among others, Hapag-Lloyd, Cosco Shipping, Arkas, Unimed Feeder Services and most recently to CMA CGM.