Tuesday, September 23, 2014
Top Story
Drewry: Container reefer capacity to grow 22 percent over 5 years
Reefer capacity on the container ship fleet will increase by 22 percent over five years at the expense of a declining specialized reefer fleet, according to the latest projections in the Reefer Shipping Market Annual Review and Forecast by Drewry Maritime Research.
The analysts predict that reefer container will grow from 1.6 million FEUs in 2013 to 1.9 million FEUs in 2018. Fleet growth over this time period is not expected to hurt vessel utilization levels due to strong cargo growth.
Reefer container volumes are forecast to rise by 20.5 million tons over this same period—16.5 million tons through organic growth and 4 million tons at the expense of the shrinking specialized reefer industry, says Drewry.
Overall seaborne perishable reefer trade will go up 17 percent between 2013 and 2018, providing an additional 16.5 million tons of cargo, according to the report.
"As a result of the expected cargo growth, reefer container slot utilization levels will be unchanged in 2015 and only marginally lower thereafter," said report editor Kevin Harding. "Meanwhile, the specialized reefer sector is forecast to shrink further as a result of scrapping and a virtually empty order book."
"The specialized reefer operators peaked some years ago, in terms of cargo volumes, and now face continued falling volumes and market shares. However, this does not necessarily affect their profitability. In fact, from the limited number of public companies reporting financial returns, profitability is indeed achievable. Specialized reefer companies are now looking to reinvent themselves to protect their undoubted expertise in their field."
The world’s largest specialized reefer operator, Seatrade, announced in July it had ordered two high-reefer-capacity, eco-designed, 2,200-TEU ships for delivery in January 2016, saying the order represented its commitment to further develop "fast, direct and dedicated" services. Emphasizing speed, specialized reefer vessels can compete with the slow sailing mega-container ships on the basis of transit times.
The report estimates that the global seaborne perishable reefer trade increased at an annual rate of 3.2 percent in the 10 years to 2013, reaching 98 million tons last year. Sectors driving this growth have been meat and exotic fruit, researchers say, with the latter rising as much as 9.3 percent each year over the period.
Drewry concludes that the specialized reefer fleet will need to diversify in order to shield themselves from losing market share to the container fleet, which will likely continue to increase their interest in the reefer business.
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