A fresh wave of up to 30 orders worth nearly $4bn for midsize container ships of between 7,000 teu and 8,000 teu is about to hit the newbuilding market.
Shipbuilding sources said this size of neo-panamax will dominate the boxship newbuilding market despite there already being close to 70 vessels of between 6,000 teu and 7,000 teu — worth $6bn — booked at shipyards in South Korea and China.
Brokers and shipyards are detailing new business that could result in orders for up to 30 vessels of about 7,000 teu over the next few months with the names of the companies behind these enquiries starting to emerge.
Names in the frame
South Korea's HMM — formerly Hyundai Merchant Marine — and Sinokor Merchant Marine are understood to have started newbuilding discussions with domestic shipyards.
HMM, one of the partners in THE Alliance — which involves Yang Ming Marine Transport, Hapag-Lloyd and Ocean Network Express — is said to be seeking 12 vessels while Sinokor needs about six.
Boxship owner Seaspan Corp, which has 25 newbuildings of 7,000 teu under construction at Chinese shipyards, is said to be looking to order more vessels.
The number of ships it is seeking has not been disclosed, but Seaspan is said to be one of the owners working on the business under the code name Project Knight. The enquiry involved up to 12 vessels worth about $1.44bn, which are to be chartered to Zim.
Zim — which has chartered Seaspan's 15 LNG-fuelled 7,000-teu newbuildings that are under construction at Yangzijiang Shipbuilding and Eastern Pacific Shipping's three dual-fuel ships at Hyundai Samho Heavy Industries — said it requires 40 to 50 ships of this size.
Brokers said Singapore’s Pacific International Lines, intra-Asia feeder liner outfit Regional Container Lines, Greek shipowner Danaos and French giant CMA CGM are also showing interest in 7,000-teu vessels.
Future workhorses
Boxship experts said there is strong demand for new 7,000-teu ships as the size is flexible to trade in the Far East Asia to Middle East, as well as north-south trades. The neo-panamaxes will also be replacement vessels of between 4,000 teu and 5,000 teu.
Atlantic Lloyd managing director Nicholaus Bunnemann believes the midsize container ships will become the future workhorse for intra-regional and north-south trades.
Pricing for the vessels is in the region of $120m to $130m, making them more attractive than a VLCC, one yard chief commented.
Brokers said three shipyards in South Korea — Daewoo Shipbuilding & Marine Engineering, Daehan Shipbuilding and K Shipbuilding (the former STX Offshore & Shipbuilding) — are looking to ride on the strong demand for the 7,000-teu container ships and have included the vessel type into their product portfolios.
DSME and Daehan have come up with designs for 7,000-teu ships, while K Shipbuilding is marketing 8,000-teu vessels.
Early slots
Tanker shipbuilding specialist Daehan said it is switching to the container ship sector as it does not expect the tanker market to recover any time soon.
Brokers think the early 2024 slots that K Shipbuilding and Daehan are offering would give them an edge over other shipbuilders.
“There are not many shipyards that are constructing the 7,000-teu container ships and those that are building are packed with orders until early 2025,” said a broker.
