The sales of container vessels for recycling remained low in H1 2024, with only 34 ships (48,600 teu) disposed of. This figure is significantly less than the 77,000 teu sold for scrap in H1 2023.
The slight pickup observed in the second half of 2023, with 81,000 teu of capacity sold was therefore not followed by the large-scale rebound in demolition transactions that was widely expected by the industry.
The main cause of the continuously low demolition sales is the persistently unsafe situation in the Red Sea. As most container lines now avoid the area and divert their vessels via the COGH, demand for additional tonnage to offset longer steaming distances has shot up.
This has given an unexpected boost to the charter and freight markets, quickly drying up supply. Even the influx of huge newbuilding capacities (1.7 Mteu delivered so far in 2024), and more fluid transits through the Panama Canal, have failed to destabilize the market.
Source: Alphaliner
