With August just around the corner, container shipping demolition has already hit a 41-month high in July, reaching 52.8 thousand TEU and thereby surpassing the 50.6 thousand TEU demolished in June. In the first seven months of the year, a total of 152.8 thousand TEU have been demolished, a 26.3% rise from the same period last year.
In July, 16 ships have been demolished, including the 1998 built Sine Maersk, the largest container ship ever to be demolished at 9,600 TEU.
The strong demolition volumes in June and July come after a few months of very low demolition activity. March, April and May in particular saw very little activity with only 21.1 thousand TEU being removed from the market, 72.8% lower than in the same three months of 2019. The low activity was a result of the lockdown measures in the world’s major shipbreaking nations as the Covid-19 pandemic took hold, preventing many owners from sending their ships to the yards.
In April, BIMCO revised its forecast for containership demolitions in 2020 from 200,000 TEU to 300,000 TEU, which would be a 63.8% increase from 2019 levels. This reflects the current market conditions, as the Covid-19 crisis has caused a dramatic drop in overall demand. Container shipping demand alone is down 7.7% in the first five months of 2020 compared to the same period in 2019.