ESS to absorb 580,000 TEU
Extra slow steaming (ESS) has created employment for almost 100 ships with a total capacity of 554,000 TEU as at the end of May according to Alphaliner. It has grown from only 5 ships for 46,000 TEU 12 months ago.
The additional capacity employed through ESS will reach 580,000 TEU by the beginning of July. This figure is based upon new services which are to be run in ESS and announced plans to slow down existing service rotations. It could rise further by the end of the year as slower
sailing speeds take hold across all linehaul trades.
The capacity absorbed by ESS represents 4.1% of the total cellular fleet and has contributed significantly to redress the supply-demand imbalance that built up in 2009. Slower sailing speeds have now become the norm on the Asia-Europe and Transpacific routes, where 78% and 53% respectively of all strings are now running in slow steaming mode. Vessels employed on these routes are currently operated in extra slow steaming mode (17-19 knots), one step further down from ‘normal’ slow steaming (20-22 knots).
Unlike the short-lived experiments made by carriers last year to route eastbound Europe-Asia services via the Cape of Good Hope, thus by-passing the Suez Canal to save on canal fees, the impact of slow steaming is expected to be more long-lasting. Recent falls in the price of fuel oil could defer some carriers’ plans to switch more services to ESS mode, but as long as fuel oil prices remain above $400/ton, the services currently in ESS is likely to stay this way.
