THE global fleet of seaborne trading vessels stands at 128,953 vessels as of the end of April 2020, with a total capacity of 2,199m dwt, according to the latest Lloyd’s List Intelligence Shipbuilding Outlook.

For the 2020-24 period, it is predicted that the total fleet will grow at an average annual rate of just 0.9%, adding 5,597 vessels in total, which is 35% or 1,964 vessels fewer than the growth seen in the 2015-19 period. However, in dwt terms, the average growth will be much higher at 3.9% on average per year.

The tanker fleet will have the highest growth rate over the coming five-year period, with 10.1% growth over the five years, increasing the fleet to 18,941 vessels.

The container and ro-ro fleet will grow by 7% to 7,737 vessels. Up to 2024, the passenger fleet is set to grow by 5.7% to 11,255 vessels. The bulker and general cargo fleet will grow by 5% to 33,485 vessels.

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Stronger tanker earnings coupled with lockdowns affecting demolition yards around the world are set to drive scrapping volumes this year to the lowest since at least 2008 — the height of the commodities super-cycle.

So far in 2020, some 55 vessels over 10,000 dwt have been scrapped, according to data from Lloyd’s List Intelligence. That is the fewest since 2008, when 52 ships totalling 2.7m dwt were broken up over the same period.

The 55 vessels over 10,000 dwt recycled over the January-through-April period totalled 4m dwt, down 42% from the same period last year.

Nine very large ore carriers or capesize bulk carriers account for just over half of scrapping activity in the first four months, Lloyd’s List Intelligence statistics show, reflecting poor rates across the sector.

Tanker earnings have reached records over the first quarter as historically low oil prices increased demand for floating storage, limiting scrapping to three suezmax and four aframax-sized crude tankers, compared with 27 bulk carriers and 40 containerships.

The high demand for tankers as floating storage is also reflected in new figures from Lloyd’s List Intelligence.

It pegs the use of tankers as floating storage at a record high, according to figures going back to 2009, of 196m barrels on 138 tankers as of the end of April, increasing by 20% in the space of a week late last month.

The spike in floating storage volumes conveys the number of floating storage contracts that were done in April as well as the number of time charters that have become storage, both due to necessity and for profit.

Land storage for oil is quickly running out as oil supply has continued largely uninterrupted over the past two months, while demand has dwindled due to the coronavirus outbreak, forcing tanker use as floating storage.

However, market stakeholders are divided on whether the tanker storage boom will last much longer. Oil trader Trafigura claimed last week that the ‘harder and larger’ than expected output cuts by the Organisation of the Petroleum Exporting Countries and other producing countries meaning the “peak of the [storage] crisis” has now passed.

But Double Hull Tankers, which owns or operates a fleet of 21 very large crude carriers, told investors they estimated volumes held on tankers would rise throughout 2020 at the same time as announcing record first-quarter revenues.

Either way, daily VLCC spot rates have fallen in the space of just two weeks to around $50,000 from highs of $230,000 last month on the major routes. Meanwhile, a high number of tanker charters have failed in the past few weeks and many owners of tanker tonnage are contemplating publishing a list that names and shames those charterers exploiting the time lapse between agreeing a charter and it being finalised.

Finally, while China’s economy continues to get back up to speed following the lockdown measures seen across much of the country at the height of the coronavirus outbreak, port calls at major container hubs Shanghai and Yangshan continue to slip further behind year-ago levels.

The latest figures from Lloyd’s List Intelligence show that in week 18 of 2020, a total of 375 vessels were recorded at the two ports, down from 378 in week 17 and 77 lower than in the corresponding week of 2019.