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Excess global demand on carriers is almost at an end

In the first article of the recent issue of the Sunday Spotlight, Sea Intelligence analysed what the effects of the removal of capacity from the market (by virtue of vessel delays) are for the effective growth in the global fleet, and its impact on the global supply/demand balance.

As a starting point, a model was created for the underlying structural fleet growth, also accounting for the unavailability of global fleet due to vessel delays. While nominal fleet grew at a steady rate of roughly 4% Y/Y in 2020-2022, there was a substantial decline in the available fleet as delays started to become severe, with a sizeable difference between the two.

 

The above figure shows the cumulative growth in available fleet size and demand in TEU Miles versus January 2020. The large spikes in demand in February 2021 and 2022 are purely a Chinese New Year effect, and do not signal any underlying shifts.

It is clear that the extreme strength in favor of the carriers in 2021 was driven by a consistently higher cumulative demand growth than the available fleet. This effect began in July 2020 and has only begun to taper off in recent months. In fact, demand was consistently 10% higher than capacity from November 2020 to January 2022. However, the gap has been narrowing, and is now down to 2% versus the pre-pandemic levels.

Source: sea-intelligence.com


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