TOPLINE The demand for shipping containers continues to increase sharply, causing shipping costs to increase to a record, despite the Covid-19 pandemic. The excess profit from container shipping not only enriches the shipping companies, but also the corporations that build new ocean-going ships and especially the companies that trade in old container ships.
KEY POINTS
- Recently, there have been two transactions of selling used container ships with super high profits.
- In order to meet the demand for cargo transportation, shipping lines are trying to expand their container fleet by buying old ships and ordering new ones.
- Ocean carriers are particularly interested in medium-sized vessels, often referred to as the Panama Max series, with a tonnage of 13,000 – 15,000 containers.
- A 15-year-old Panamax ship, worth 20 million USD before the pandemic, is now up to 48 million VND.
ARTICLE
The excess profit from container shipping not only enriches shipping companies but also corporations building new ocean-going ships and especially companies trading old container ships. Recently, there have been two trade deals of old container ships with super high profits.
Specifically, in February 2020, Greek shipping group Tsakou bought an old container ship for only 13 million USD from a German shipping company. Recently, the Greek corporation has just sold this old ship for $ 39 million, earning a profit of $ 26 million after 1 year only from an old ship built since 2007.
Another good example is Technomar Shipping, which has just sold a container ship called Nasia for $ 36 million, before it bought this ship for $ 10 million in 2018.
Currently, in order to meet the needs of cargo transportation well, shipping lines are trying to expand their container fleet by buying old ships and ordering new ones. In the first 6 months of this year, shipping lines have ordered 286 new container ships, meaning that the demand for container ships has increased by 790% compared to the first half of 2020, an increase not seen in 20 years.
After the Ever Given ship got stuck in the Suez Canal earlier this year, demand for super-large ships that can carry more than 20,000 20-foot containers has dwindled. Currently, shipping lines are particularly interested in medium-sized vessels, commonly known as the Panama Max line, with a tonnage of 13,000 – 15,000 containers.
Therefore, the selling price of medium-sized ships has increased dramatically. A 15-year-old Panamax, which was worth $20 million before the pandemic, is now up to 48 million. Despite such an increase, many businesses are still willing to buy, as profits from shipping have more than doubled since the beginning of the year. Earlier this year, a Panamax-sized ship made $19,000 a day. Now, a container ship of this type brings the shipping company up to 45,000 USD in profit per day.
Phan Quyen
FURTHER READING
Ever Given to finally depart Suez Canal on July 7th
