IMO 2020 will lead to a ‘massification’ of volumes on all box trades: Alphaliner

IMO 2020 will lead to a ‘massification’ of volumes on all box trades: Alphaliner

The liner sector faces an “interesting” year ahead and ought to scrap more ships before a stronger case for a positive market outlook can be made, according to the first report in 2019 from the well-respected analysts at Alphaliner. Like last year, the spectre of the sulphur cap will have a significant impact on the container markets in 2019, Alphaliner is suggesting.

“IMO 2020 will be a game changer, as it will bring the fuel costs to the forefront. It should lead to a massification of volumes on all trades that will benefit the larger ships at the expense of smaller ones,” Alphaliner commented on the impending global sulphur cap, adding that it anticipated a very limited scrubber uptake among global box fleet

On the markets Alphaliner said the ongoing struggle to balance supply with demand will drive both the freight and the charter markets in 2019.

Some 1.15m teu of newbuilding capacity is due to be introduced in 2019, although Alphaliner reckons this will be tempered by expected slippages in deliveries and scrapping.

Overall fleet growth is expected to slow down to 3.5% in 2019, which Alphaliner stated would provide some relief for the overtonnaged market.

Moreover, the expected rush to retrofit part of the current fleet with scrubbers before the new IMO sulphur cap takes effect in January 2020, is also expected to result in a reduction of available tonnage during the year.

“Much will however also depend on the carriers’ ability and willingness to maintain capacity discipline,” Alphaliner concluded.

Sam Chambers

Starting out with the Informa Group in 2000 in Hong Kong, Sam Chambers became editor of Maritime Asia magazine as well as East Asia Editor for the world’s oldest newspaper, Lloyd’s List. In 2005 he pursued a freelance career and wrote for a variety of titles including taking on the role of Asia Editor at Seatrade magazine and China correspondent for Supply Chain Asia. His work has also appeared in The Economist, The New York Times, The Sunday Times and The International Herald Tribune.

Related Posts