Boxships as young as 13-years-old are now being scrapped, brokers tell Splash. Panamax ships are the main focus of scrapping in the container sector, their size now finding it hard to get decent charter rates since the opening of the expanded Panama Canal at the end of June.
The 4,600 teu Seaspan Excellence, built in Japan in 2003, has been sold at a firm price of $280 per ldt. The Hong Kong-flagged vessel, owned by Seaspan, was most recently on charter to Japan’s Mitsui OSK Lines (MOL). When it came off charter and no decent offers came in for it, the Gerry Wang-controlled leasing firm decided it was best to scrap it, becoming one of the youngest boxships to date to meet the welder’s torch.
Meanwhile the 4,389 teu HS Beethoven, built in 2002, also received a firm price of $275 per ldt in the past week. The 14-year-old ship is owned by Hansa Treuhand and had most recently had been on charter to CMA CGM.
A report by BIMCO at the end of June highlighted how the panamax segment had seen 150,863 teu of scrapping in the first six months, the same volume as in the previous 18 months through to end December 2015.
Time charter rates for the panamax segment went down from the monthly average of $15,800 per day in March 2015 to a monthly average of $5,755 per day in July 2016, a drop of 63.5%.
“The expansion of the Panama Canal backs up the shift away from the segment of panamax ships which have a maximum beam of 32 metres, putting them in line for demolition,” BIMCO chief analyst Peter Sand noted in the report.