Global Ship Lease is seeing a rise in interest in longer charter terms for container ships as freight rates rise amid the Red Sea crisis.

The US-listed container ship owner’s chief commercial officer, Thomas Lister, said that smaller boxships which might have been chartered for two to three months in late 2023 can now find 12-month contracts.

Larger vessels that could have attained yearlong charters are now being fixed for two to three years, said Lister, who will replace Ian Webber as chief executive at the end of the this month.

“The larger the ship and the higher the specification there is growing appetite to forward fix in the market by quite a number of months in some instances,” Lister said, asked by an analyst whether charterers of vessels that are coming open are showing interest to extend.

“So we’re always doing the best we can to capitalise on that environment while we can,” he added.

After container freight rates slumped from their pandemic heights, Houthi attacks on shipping have led boxships to avoid the Suez Canal at a time when its rival in Panama has also been crimped, leading to longer voyages and a rate rebound.

Speaking on a conference call to discuss quarterly earnings, Lister said Global Ship Lease will give an update in its next report to explain how it is taking advantage of the period charter appetite.

But he warned that charterers holding extension options that are “in the money” — that is, they are set at a rate that is at a lower cost than the prevailing market — will take advantage of it.

“However, if there are no such options, we are in very constructive conversations with those charterers to extend and if there is no appetite from a given charterer then we will look more broadly,” Lister said.

“But I would say, generally speaking, [it is a] supportive environment and we’re making use of it.”

As TradeWinds reported earlier on Monday, UK-based Global Ship Lease reported a bottom-line profit of $64.7m, down from $72.6m a year earlier, while normalised net income jumped 13.6% to $87.8m.

“We have entered 2024 with strong charter coverage for much of the year and continue to work hard to capitalise on current market firmness to grow contract cover and strengthen forward cash flow visibility,” executive chairman George Youroukos said.