Lower bunker prices are unlikely to reverse the current trend of slow steaming for container lines according to AXSMarine’s weekly analysis of the liner market. Bunker prices have seen a sharp decrease in the past three months, from $650 in end August 2008 to $250 today, thereby eliminating the primary motivation for slow steaming programs.
However, analysts with AXS-Alphaliner believe that “current depressed box rates and the difficulty to recover fuel costs (although much reduced) through BAFs” still present a powerful case to continue operating vessels at slower speeds. “Clearly, fast transit times do not receive the attention they used to get,” the newsletter states.
Additionally, AXSMarine has highlighted optimising use of the high level of tonnage in the market (with a significant number of newbuilds due for delivery in the near future) and the need to cut emissions as further reasons to maintain slow steaming programmes. “Carriers have insisted a lot on these green aspects in their communication this year, associating their slow steaming programs with emission reductions more than with cost savings,” the analysts maintain, adding, “Should they wish to revert to faster loops, the green argument would be seriously challenged.”
However, analysts with AXS-Alphaliner believe that “current depressed box rates and the difficulty to recover fuel costs (although much reduced) through BAFs” still present a powerful case to continue operating vessels at slower speeds. “Clearly, fast transit times do not receive the attention they used to get,” the newsletter states.
Additionally, AXSMarine has highlighted optimising use of the high level of tonnage in the market (with a significant number of newbuilds due for delivery in the near future) and the need to cut emissions as further reasons to maintain slow steaming programmes. “Carriers have insisted a lot on these green aspects in their communication this year, associating their slow steaming programs with emission reductions more than with cost savings,” the analysts maintain, adding, “Should they wish to revert to faster loops, the green argument would be seriously challenged.”