Drewry forecasts more slow steaming

   Drewry is predicting an increase in slow steaming by container carriers.
   “Although slow steaming continues to be a contentious issue with shippers, more is on the way as fuel prices remain stubbornly high and ocean carriers can no longer absorb the bill due to the parlous nature of their finances,” the London-based consultant says in the latest edition of its Container Insight Weekly.
   “Drewry believes that ocean carriers are losing money at present due to the freight rate war taking place in the east-west trades, and they are still confronted with surplus capacity. At the end of April, there were still another 31 ships over 10,000 TEU due for delivery this year, and carriers are running out of places to hide unwanted 8,000-TEU vessels cascaded out of the Asia-Europe tradelane.”
   It argues there is not enough growth on the Asia-U.S. or Asia-South America trades to absorb added capacity. Faced with the choice between laying ships up or slowing them down, carriers will choose to slow ships.
   There is “wide margin to play with” in ship speeds, says Drewry. In Asia-North Europe trade, Drewry said ships speeds range from 22.3 knots to 15.2 knots westbound and 16.9 to 11.7 knots eastbound. In the Asia-West Coast lane, speeds range from 24.7 to 15.7 knots eastbound to 18.8 to 13.8 knots westbound.
   With rates low, carriers may argue shippers should get the service they pay for. Drewry says “ocean carriers do not appear to get much of a freight rate premium for faster service, although market feedback is mixed on this.” – Chris Dupin