SIMIC

A lengthy list of newbuildings is due to be delivered in the next two to three years, while benchmark time-charter rates have plunged 80 per cent in the past two months.

Nevertheless, new charters are still being agreed at daily hire rates of about twice that achieved before the Covid crisis.

Moreover, non-operating containership owners (NOO) have significant revenue backlogs from unexpired long-term charters with carriers, reports London's Loadstar.

Athens-based feeder and intermediate-sized NOO Euroseas said the market was "facing strong headwinds and an increasingly pessimistic outlook".

It added: "While charter rates have fallen due to the easing in supply chain disruptions that built up over the pandemic, a lot of the slowdown in container and vessel demand has been due to weaker cargo demand."

The Nasdaq-listed company, which operates a fleet of 18 ships, ranging from 1,400 to 6,350 TEU, and has nine feeder vessels under construction, said the outlook indicated "a further softening market".

The Aristides Pittas-led shipowner said one of the biggest challenges would be "absorption of the orderbook", which now stands at nearly 29 per cent of the existing containership fleet.

"This orderbook will start being delivered from the second half of 2023, and is heavily concentrated on the larger containership segments, much less on the feeder-size segments in which we operate," said chairman and CEO Mr Pittas, as he announced Euroseas' Q3 earnings.

Furthermore, he argued, the IMO's new environmental regulations "will probably result in even slower steaming" and, therefore, moderate the impact on the sector.

"The feeder fleet, in addition, has an age profile tilted towards older vessels and, as a result, is expected to be affected the most by the greenhouse gas regulations being introduced in 2023," he said.

NOOs have full charter coverage for its fleet for the remainder of this year, but that drops to 78 per cent next year and 54 per cent in 2024, as charter periods expire.