Container leasing market under pressure as carriers cut back
After a strong first six months with container drop-offs at an exceptionally low level, container leasing companies face a tougher second half. Financially stressed ocean carriers are closing loss-making routes and postponing new services.
This month’s Drewry Container Census & Leasing annual review and forecast report expects the return for the sector to be “squeezed”, due to the higher cost of newbuild equipment and static leasing rates.
“With little change in lease rates anticipated over the next few years, investment returns are forecast to remain under pressure,” said Andrew Foxcroft, Drewry’s lead analyst for container equipment.“Although we have seen returns edge up to near 10% in the first half of this year, we do not expect these levels to be sustained given the recent build-up of factory stocks.”
Long-term lease rates for standard dry containers soared by over 50% last year, a spike attributed primarily to the Hanjin bankruptcy in September 2016, which tied up large quantities of empty equipment seized by the South Korean carrier’s creditors. Hundreds of Hanjin leased containers are still unrecovered.
However, with most container lines moving back into the black in 2017, the liners regained their appetite to upgrade and expand services, thus they were in the market for more equipment.
Moreover, 2017 also saw a significant rebound in container manufacturing after almost grinding to a complete stop the previous year.......
If you want to see more pictures, and learn more,pls click here:http://sowoll.com/en/blog/post/387-container-leasing-market-under-pressure-as-carriers-cut-back
This month’s Drewry Container Census & Leasing annual review and forecast report expects the return for the sector to be “squeezed”, due to the higher cost of newbuild equipment and static leasing rates.
“With little change in lease rates anticipated over the next few years, investment returns are forecast to remain under pressure,” said Andrew Foxcroft, Drewry’s lead analyst for container equipment.“Although we have seen returns edge up to near 10% in the first half of this year, we do not expect these levels to be sustained given the recent build-up of factory stocks.”
Long-term lease rates for standard dry containers soared by over 50% last year, a spike attributed primarily to the Hanjin bankruptcy in September 2016, which tied up large quantities of empty equipment seized by the South Korean carrier’s creditors. Hundreds of Hanjin leased containers are still unrecovered.
However, with most container lines moving back into the black in 2017, the liners regained their appetite to upgrade and expand services, thus they were in the market for more equipment.
Moreover, 2017 also saw a significant rebound in container manufacturing after almost grinding to a complete stop the previous year.......
If you want to see more pictures, and learn more,pls click here:http://sowoll.com/en/blog/post/387-container-leasing-market-under-pressure-as-carriers-cut-back
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