A large number of new container ships due for delivery this year and next, and the possible return to service of idled vessels could extend industry oversupply into 2011, according to Bronson Hsieh, the chairman of Evergreen Marine, Dow Jones reported.
Container shipping line operators have posted large losses since the end of 2008 following the onset of the financial crisis, prompting them to scrap old vessels and idle some of their fleet. Those moves, coupled with improvements in the global economy, have helped freight rates to rise recently.
Hsieh said the recent increases in freight rates would help the industry narrow its losses in the second half from the first half, but he warned oversupply remains a concern.
This year, 286 ships with a capacity of 8,000 TEUs and above will join the global container fleet, while another 211 ships of this size will enter service next year, Hsieh said.
"And there over 500 redundant ships, anchored outside ports, waiting to re-enter (service)," he said. "The industry may return to normal perhaps in 2012."
Cargonews Asia Pacific
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