Containership scrapping nears 700,000-TEU mark in 2016

The ocean shipping industry set new records for demolition this year, sending 201 ships with an aggregate capacity of 699,000 TEUs to the scrapyard as of Dec. 20, according to the latest data from shipbroker Braemar ACM.

Containership scrapping continues its breakneck pace in 2016 and looks likely to break the 700,000-TEU mark before year’s end, according to the latest data from shipbroker Braemar ACM, as reported by industry news outlet The Loadstar.

The ocean shipping industry has already set new records for demolition this year, sending 201 ships with an aggregate capacity of 699,000 TEUs to the scrapyard as of Dec. 20, a massive increase from 187,500 TEUs in 2015.

According to Braemar ACM, 32 containerships with 102,000 TEUs of capacity were sold for scrap in the 30 days from Nov. 21 to Dec. 20 alone.

Scrapping has accelerated over the course of the year amid falling freight rates, as well as book values and charter rates for containerships, spurred by rampant overcapacity. This has also resulted in the most active year on record in terms of carrier consolidation via bankruptcies, mergers and acquisitions, but analysts have questioned whether all this will be enough to restore the balance between supply and demand in order to push rates back up to a profitable level.

Source: American Shipper