Tag Archives: Maersk
AP Møller-Maersk, owner of the world’s largest container line, has revealed it is ready to outlast its rivals, as the industry faces a possible four years of overcapacity.
Throughout this year, containership owners have seen billions of dollars wiped off the value of their fleets.
Massive overcapacity has squeezed not only freight rates, but also the worth of steel on the water.
The world’s largest boxship owner, AP Møller-Maersk (APMM), has seen the value of its containership fleet fall 24% in the past 12 months. Its 222 vessels currently in service are now worth US$9.1 billion, compared with $12 billion at the start of November last year.
Similarly, major owner and operator MSC’s fleet of 202 containerships in service are worth $6.9 billion, compared with $8.4 billion 12 months ago.
In a revealing interview yesterday, APMM CEO Nils Smedegaard Andersen said: “We are actually quite well positioned for a longer stretch of tough competition,”
He added: “It would be natural if the smaller players in this business, or their banks, start questioning whether it’s a good idea to keep competing.”
Maersk Line, with almost 16% of the global container market, is betting it can outlast such publicly traded competitors as Japan’s MOL and NYK, both of which have cut capacity to cope with falling freight rates.
Success may help reverse a Maersk share decline this year of 28%, compared with a fall of 17% in the OMX Copenhagen 20 Index.
At the beginning of this month APMM revealed that Maersk Line, which is often regarded as a barometer of global trade, posted a third-quarter net loss of Dkr1.58 billion (US$293 million) compared with a profit of Dkr5.9 billion a year earlier
MAERSK has sparked a “race for ultra-large containerships” in 2006 when it introduced its 15,550 TEU E-Class vessels, according to Paris-based maritime consultancy Alphaliner.
Ironically, Lloyds List reports Maersk group CEO Nils Andersen saying shipping lines have been engaged in “reckless ordering” and are putting their businesses at risk by joining the race.
The Danish shipping giant has maintained its lead, most recently ordering twenty 18,000 TEU or EEE-Class ships, due for delivery between 2013 and 2015, said Alphaliner, the Paris-based maritime consultant and information agency.
In a further move to increase capacity, Maersk has now embarked on a “capacity boost” that will see a number of the line’s 8,200-8,600 TEU S-Class ships upgraded to 9,600 TEU.
Alphaliner said the upgrade involves the raising of the wheelhouse so that two extra tiers of containers can be stowed forward of the accommodation block.
While the vessels’ maximum TEU capacity will be notably increased by the conversions, the ships’ effective tonnage will remain almost unchanged. The enhancement aims at increasing the ships’ capacity for lightly-loaded containers and at providing additional slots for repositioning empties.
The enhancement of the 10 ships will add some 12,000 TEU to the Maersk’s fleet which, according to Alphaliner figures, currently totals 2.44 million TEU.
Six other S-Class ships could have their capacity enhanced after the first 10 units have been converted.
In total, 25 S-Class units have been built between 1997 and 2002. They were the first containerships larger than 8,000 TEU. The enhancement work has been commissioned at CSIC Qingdao Beihai Shipbuilding and Heavy Industries.
The first two ships, the Carsten Maersk and Charlotte Maersk, already underwent conversions in June and July. They have since returned to Maersk’s FE-Centram and FE-Europe runs.
A third unit, Svend Marsk, is at the yard and will be redelivered in September. The remaining ships will follow at an approximate rate of one vessel per month.
Several owners recently upgraded the capacities of ships they had ordered earlier through such renegotiations. Such upgrades add extra capacity that has an impact on the supply forecast.
Upgrades of ships in the orderbook over the past 12 months include: CMA CGM’s upgrade of three 13,830 TEU ships on order at Daewoo to 16,000 TEU, Hapag-Lloyd’s upgrades of six 8,750 TEU units from Hyundai Heavy to 13,100 TEU, NOL’s upgrade of ten 8,400 TEU units on order at Daewoo to 9,200 TEU and NYK’s upgrade of two 6,350 TEU units on order at Imabari to 8,000 TEU.
Source: SeaNews Turkey
Denmark’s AP Møller-Maersk, operator of the world’s largest container ship fleet, on Wednesday announced record $5bn net profits for 2010 – a year after announcing the only full-year loss in its 107-year history.
However, the shipping and oil conglomerate warned that 2011 results were likely to be worse than those for 2010, as the growth of the world container ship fleet outpaced demand and the company’s oil and gas production declined.
At a hearing today in Newcastle Magistrates Court, the Owners of the UK registered container ship Maersk Patras pleaded guilty to eight charges of failing to provide adequate hours of rest for the crew and one charge of failing to improve the situation.
In September 2009, the MCA conducted an audit on board the Maersk Patras at Bremerhaven. It was noticed that the Captain, Officers and other crew members had not been having the required periods of rest as laid down by international agreements.
The company, A.P. Moller-Maersk A/S of Denmark, were informed of these concerns but failed to correct matters and the breaches of the regulations continued. On the 25th January 2010, the MCA issued the company with an Improvement Notice which required them to rectify the position by the 28th February 2010. They also failed to comply with that notice.
A.P.Moller-Maersk were fined £18,500 plus costs of £4,439.27
Neil Atkinson, Marine Surveyor, Maritime and Coastguard Agency said:
Fatigue is often a significant factor in accidents, whether it is to individuals or to the ship itself. For this reason the MCA are focusing on seafarers hours of rest during routine inspections of UK and foreign flag vessels. This conviction should send a strong message to the industry that failing to provide adequate hours of rest for the crew is not acceptable.
Graham Duff, prosecuting on behalf of the MCA said in court:
The hours of rest regulations are not just a bureaucratic exercise, they are all about safety.
It should go without saying that fatigue, particularly for decision makers on board large vessels, is a very real enemy and presents a significant risk to the safety of others.
Maersk Line said that, on May 1, it will introduce an “out of service” (OOS) charge of US$ 150 per dry container and US$ 350 per reefer container to cover additional costs incurred when a container is damaged.
The Danish line said this will include transport, lifting, replacement and administration costs previously covered by the shipping company — but not the repair costs.
“In practice, this means that for damage cases where the repair itself costs up to US$ 50, the party liable for the damage will pay US$ 200 per dry container and US$ 400 per reefer container,” Maersk stated.
“We sincerely believe the OOS charge is the fairest way to cover the costs for damaged containers — as it means that only parties who are responsible for damage will have to shoulder the costs.”
Curious as I am, I had to google and wikipede around, and I found a quite interesting feature from The Buteman as well as more information from the Wikipedia on the Maersk Boston, the first of the seven ships that belong to the class.
Here is a sample of what I read on The Buteman:
“These particular ships [the B-class ships] were ordered when the world economy was in really good shape, but they are not very efficient – they are too small, and they are built for speed, and they use a lot of fuel.
On the bridge of the ‘Beaumont’, Maersk’s fleet superintendent Stewart Kerr explains that the B class was built in Germany for the specific purpose of taking cargo by high speed from China to the USA. Each was designed to have a service speed of 29 knots ahead (and 19½ knots astern!), though the Boston, the first of the class, reached a remarkable 32½ knots during trials.
The vessel’s main engine produces a power output equivalent to 135 McLaren Formula One racing cars, and boasts 12 cylinders, each capable of running at 102 revolutions per minute (rpm) – all powering a directly-driven propeller six and a half metres in diameter and weighing 82 tonnes, itself capable of providing 17 knots of speed at a rate of 55rpm.
But running ships at that kind of speed requires an awful lot of fuel, so when the recession began to bite in the autumn of 2007, Maersk’s search for economies quickly fell upon the B class. In fact, they have never operated on the route, or at the service speed, for which they were intended.
“The price of oil at one point rocketed to $700 per tonne,” Stewart continues, “and these ships will burn three hundred tonnes of fuel a day at full speed, which just wasn’t viable.
(…) even though there is more life here [at the engine room] than anywhere else on the laid up ship, all of that oomph, and all of that human expertise, is not designed to be lying stationary in a loch on Scotland’s west coast.
But the future, it seems, does not belong to fast shipping, even though the world’s economy recovers sooner than expected. Carriers and owners learnt that speed is a powerful tool to mitigate the damage caused on freight rates by the imbalance between supply and demand.
If slow steaming is really here to stay — and the evidence affirms that it is –, the B-class are unlikely to come back to the oceans in their present configuration. And, at any rate, their history is a stunning reminder of how irrational shipping was in the last few years.