THE number of “idle ships”— ships not used for commercial operations—increased from 238 vessels with a combined capacity of about 900,000 TEUs (20-foot equivalent units) in November last year to 435 ships with a capacity of 1.7 million TEUs in early November this year, according to maritime analysts Drewry.
Drewry said the idle fleet currently accounts for about nine percent of the total global containership fleet. At the beginning of last year, the marine analysts added, the idle fleet represented just 2.5 percent of the global fleet.
One factor in the rapid growth in the numbers of idle ships, Drewry said, is the increasing overcapacity in the global container shipping sector, particularly the surplus capacity in old Panamax ships (typically 4,000-5,000 TEUs) following the widening of the new Panama Canal locks in June.
Drewry pointed out the capacity of idle ships of 3,000-5,000 TEUs has doubled since last November; 89 ships of this size were idle as of November 7. This size of ships makes them too small for the main trades and they are increasingly seen as obsolete.
It added that the idle fleet would be even larger than 1.7 million TEUs if some 550,000-600,000 TEUs of ship capacity had not been scrapped during the course of 2016.
Another factor behind the surge of idle ships is the bankruptcy of Hanjin at the end of August. The former Hanjin-operated fleet account for 622,958 TEU (or 36 percent) of the total idle fleet, Drewry said.
Although it is normal for vessels to be taken out of service during the slack season, and an increase in idle fleet after the busy summer peak season was expected, Drewry stressed that more than 1.1 million TEUs—about 65 percent—of the idle fleet are ships owned by non-operating owners.
Drewry also pointed out that more than 60 percent of the current idle fleet are ships less than 10 years old, another strong sign of overcapacity.
“The young age of the growing idle fleet is a strong indication of the current over-capacity. More non-operating owners will need to assess whether future demand for chartered tonnage justifies parking these idle assets (at an ongoing cost) or whether they should bite the bullet and scrap them. A robust risk analysis will be needed to make this decision,” the report concluded.