Prices of new container ships increased by more than 50% year-on-year （2024）

December 18, 2024

Container newbuilding values are currently at an all-time high.

The value of 15,000 TEU Panamax newbuildings has continued to rise since the beginning of the year and currently stands at US$210.5 million, compared with US$158.52 million in the same period last year, an increase of approximately 33% year-on-year.

Rates for 7,000 TEU Post-Panamax vessels exceeded the record set in 2010 earlier this year and have continued to rise since then.

Currently, the value of new Panamax ships is US$114.7 million, an increase of approximately 32% from US$87.03 million last year. The cost of new shipbuilding has increased due to increased demand, limited supply from shipyards, rising material costs, and competition from other ship types for existing ship slots.

So far this year, a total of 254 new container shipbuilding orders have been signed globally, a year-on-year increase of approximately 52%, and before 2023. The total number of orders in 10 months was only 167.

The majority of these orders are Neo-Panamax, accounting for approximately 41%, followed by Post-Panamax, accounting for approximately 27%, and the third are ultra-large container ships, accounting for approximately 22%.

Container ship shipping has boomed during the COVID-19 pandemic, with a large number of newly delivered container ships joining the fleet in the past few years.

The number of new container ships entering the market in 2024 has also reached a record high. So far, 362 ships have been delivered this year, and 169 more will be delivered by the end of the year.

At the same time, due to good profitability this year, the scrapping volume is still low, with only 48 container ships worldwide being sent for scrapping, a year-on-year decrease of about 45%. The average age of the container fleet is 12 years, due to new shipbuilding in the 2000s

boom, there is ample supply of used ships, so if earnings fall, there is still some potential for scrapping in the market.

Container ship operating income in 2023 will fall from the highs in 2021 and 2022. Starting from 2024, operating income will rebound again. At present, the revenue of all ship types has increased year-on-year.

Reasons for this include increased demand due to the Red Sea crisis forcing ships to sail longer distances around the Cape of Good Hope, the GRI (generalized freight rate increase) that came into effect in mid-November, strikes in Canada, and strong trading volumes. In the field of post-Panamax container shipping, current revenue has doubled compared to the same period last year.

Since July this year, the one-year charter rate for post-Panamax vessels has been hovering around US$72,000/day, while the rate for the same period last year was approximately US$36,000/day, a year-on-year increase of 100%.