Analysts Warn of Overcapacity as Containership Orderbook Reaches 15-Year High

By Alison Koo (The Loadstar) – Mid-size and feeder vessels continue to dominate newbuilding orders in the past week, taking the box ship orderbook to well over 10m teu, a 15-year high.

The size of the orderbook has seen analysts raise concerns of potential overcapacity.

Companies commissioning ships lately include intra-Asia carrier Ningbo Ocean Shipping, which returned to CSSC Huangpu Wenchong Shipbuilding for up to six 4,300 teu ships, four firm orders and two options.

The carrier said in a Shanghai Stock Exchange filing the cost would be up to $278m for the newbuildings, and follows an order for four 2,700 teu ships from Wenchong in May.

South Korean feeder operator Pan-Continental has ordered a newbuilding for the first time since 2021, when it commissioned a 1,100 teu ship at Yangzijiang Shipbuilding for $23.1m, with an option for another.

Indonesian domestic operator PT Meratus Line has returned to CSSC Guangxi Shipbuilding for two 680 teu ships, to be delivered in 2027, adding to four similar vessels scheduled for delivery next year.

MB Shipbrokers said major Chinese shipbuilders had continued to fill their yard slots with feeder vessels, amid an aging fleet.

The Danish brokerage added: “Overall interest in both feeders and mid-size vessels remains high, while interest in the larger sizes, above 10,000 teu, has cooled off in recent weeks.”

However, South Korea’s KMTC Line has bucked that trend by ordering four 13,000 teu ships at HD Hyundai Heavy Industries, entering the 10,000 teu segment for the first time. The newbuild price was not disclosed, but is estimated at $150m each.

KMTC returned to the transpacific lanes in May after a 40-year absence and the newbuildings, expecting to be delivered in 2028 and 2029, suggest the regional carrier might be committed to the long-haul trades.

Meanwhile, analyst Linerlytica noted that the current orderbook had risen to the equivalent of almost 32% of the in-service fleet – its highest level since 2010.

Expressing concern over potential overcapacity, Linerlytica explained: “The last time the orderbook ratio exceeded this level, in 2004-2009, it ended in a decade-long supply overhang that took 10 years to clear.

“And there’s still more than one million teu of pending ship orders due to be added before the end of this year.”

Subscribe for Daily Maritime Insights

Sign up for gCaptain’s newsletter and never miss an update

— trusted by our 108,366 members