Q1 2023 Forecast: Container Values Stabilize, Tanker Tonne Mile Demand Expectations Remain Strong
We take a look at the main points from the Tanker forecast:
- While Russian exports for both crude oil and products will decline, sourcing supplies to Europe from other suppliers such as MEG, US and Latin America, should increase tonne mile demand and support Tanker rates going forward.
- Tanker vessel ordering activity has been low for the past two years, which with expectations of a slight increase in scrapping activity serves well for the overall market balance, as the orderbook remains low at <5%.
- The International Maritime Organisation’s (IMO) greenhouse gas (GHG) emission targets that were enforced in 2023 should have an impact on fleet efficiency. This will have implications for the effective trading capacity of the fleet, boosting prospects from 2023.
- Tonne mile demand expectations for 2023 and beyond remain strong in our current base case. With the reversal of its strict zero Covid-19 policy, China is expected to reclaim its position as the leading oil demand driver, supporting Tanker markets further.
Container Values Stabilise
Having fallen steadily for almost a year, following a record breaking peak in April 2022, Container values appear to have found a floor and are now beginning to stabilise. Values for 5YO Panamax Container ships of 4,250 TEU have seen a small increase of c. 1% since the start of March to USD 39.68 mil.
This comes as Container indices, that have plunged since August 2022, increased throughout the month with a minor gain of 1.6% from 7,999 USD/TEU to 8,129 USD/TEU. One year TC rates continued to stabilise further in March with Panamax earnings up by 5%, from 18,080 USD/Day to 18,970 USD/Day.
Notable sales include a total of 10 New Panamax vessels of 13,700 TEU, ordered by ONE and scheduled for delivery in 2025 and 2026. In the secondhand market, due to rates stabilising, there have been a few sales reported. This includes the Handymax Itha Bhum (1,324 TEU, Aug 1996, Mitsubishi HI) sold for USD 4.0 mil, VV Value 4.72 mil and also Handymax G Box (1,705 TEU, Apr 2018, Guangzhou Wenchong) sold for USD 20.5 mil, VV Value 19.36 mil.
VesselsValue data as of March 2023.