Container Ship Capacity Grows 10 Percent

Global container ship capacity is up 10 percent since August of last year.  A dreary summer trade season, coupled with weak cargo demand has cut demand for vessel space and put added pressure on operators to keep freight rates at a 20-month low as they redeploy their vessels to trade routes with more activity.  Carriers have increased capacity on all routes, with secondary line haul markets in South America and Africa seeing the largest increases.

The active global fleet reached 14.05 million 20-foot equivalent units (TEUs) in the beginning of August, up 1.33 million TEUs from the year before. Until demand for vessel capacity rises to a level more balanced with current supply, freight rates will remain at these lows.  In good news, analysts predict that this year should see a more conventional peak season for imports, with September and October expected to be strong months.

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