Headlines
Irish Shipping volumes up 3% during Q2 2015

National Developments
Ardmore Shipping Corporation 99.9k DWT Summer Deliveries

Irish port sector received EU support for future development plans

IMERC & Naval service co-operate on innovative wind propulsion project

2016 European Sea Ports Organisation conference confirmed for Ireland

International Developments
More shipping line mergers ‘would stabilise market’

Deep Sea Container Trades Clock Up TEU-Miles

Crude oil prices retreat towards $50 on demand concerns

Tanker market looks set to stay the current course for the next few months

Forthcoming Events
NMCI to host annual Irish Maritime Forum

International maritime safety conferencing coming to Cork in October 2015

Ocean Energy Europe 2015

Maritime Education
Institute of Chartered Shipbrokers (Ireland) 2015 -2016 Courses

IMDG Dangerous Goods by Sea Course
Useful Links
Send this to a friend »

Subscribe to receive this newsletter regularly »

Printer Friendly Version »

View Newsletter Archive »

 
Deep Sea Container Trades Clock Up TEU-Miles
by Clarksons Shipping Research

The global Container trade has grown firmly over the last decade, with much of this expansion driven by trade on the intra-Asian network.

The deep sea mainlane trades in particular are punching above their weight in terms of TEU-mile growth when analysing the TEU-miles growth.

In 2005 container trade totalled 105m TEU, and by year end 2015 it is expected to reach 179m TEU. The mainlane routes, which had historically represented a major growth area of container trade, have expanded at a relatively modest rate in the last decade, at a CAGR of 3.0% per annum, compared to growth of 5.5% per annum in total box trade. Overall, mainlane trade growth has accounted for 19% of total container trade expansion over the period. Intra-regional trade (the majority of which is accounted for by intra-Asian routes) has been by far the largest contributor to container trade growth, accounting for 47% of expansion in global trade in TEU and growing at a CAGR of almost 7% per annum in 2005-15.

The pattern of trade growth has been much more evenly spread between the routes when looking at expansion in terms of TEU-miles. Demand for container shipping is driven by not only the number of boxes moved, but also the distances involved; mainlane routes are much longer than intra-regional trade lanes.

By using standard distance assumptions for each trade lane, and weighting trade growth in TEU by the miles travelled, a picture of container trade in terms of TEU-miles emerges. In the 2005-15 period, the various routes have each contributed between 17% and 32% to global TEU-mile trade growth, a much smaller range than growth in total TEU (which varies between 16% and 47%). Mainlane trade appears as the biggest driver of TEU-mile growth, while the contribution of intra-regional trade is reduced to 27%. Together, the deep sea mainlane and North-South routes have accounted for 55% of growth in TEU-miles over the ten year period, versus 36% in TEU terms.

Ordering Hints

This large difference between the contribution of mainlane routes to growth in TEU and TEU-miles may help to shed some light on recent ordering trends. Contracting of ‘megaships’ has principally been driven by the continued pursuit towards lower unit costs. However, the vast majority of very large boxships are deployed on mainlane routes (92% of capacity in the 12,000+ TEU sector is deployed on the Far East-Europe route), where although trade volume growth has typically been slower than elsewhere, a notable ‘TEU-mile’ benefit is visible.

A Different Vista

So, the rapid growth in box trade on intra-Asian routes still stands out as a principal driver of global trade expansion over the last decade. But looking at the figures in a different way suggests a perhaps more balanced picture for boxship demand across the various trade lanes. That is why container shipping needs the deep sea trades to keep clocking up the miles.

 Source: Clarksons, September 2015

Rate: 12345 (0) | Facebook Twitter LinkedIn
Email Software by Newsweaver