Dropping container freight rates have taken their toll on newer and smaller players in the liner shipping industry. Charter rates for 1,500-1,900 TEU ships have taken a serious hit recently, with the latest fixtures concluded at levels 35% lower than last comparable deals.
Illustrating this, Turkish liner operator Akkon Lines recently chartered the 1,732 TEU A Daisen for US$35,000/day for six months. The charter rate represents a near 50% drop from the US$60,000/day that Alibaba’s shipping affiliate, Transfar Shipping, paid to hire the vessel from February to August this year.
In March, midway through Transfar’s charter, the company decided to buy the ship for US$33 million to control its chartering costs. For Transfar to fix out the vessel to Akkon Lines, instead of operating the ship itself, was yet another sign that liner operators’ party was over.