Container Market Report August 2016

On the night of Friday, August 5, the 31st Game of the Olympiad began in Rio de Janeiro, Brazil. The first Olympics are held in South America. Players more than 11,000 from 205 countries and areas compete in the result of their exercise for the past 4 years by 28 competitions 306 games in the field for 17 days until an end on Sunday, August 21. There is Brazil in the Southern Hemisphere located in the other side of the earth from Japan, and the difference in time with Rio de Janeiro is 12 hours. While it is troubled here for a while by lack of sleep, most of the nations will support the player of their own country.

There is a pro and con in OLYMPIC, but, once in four years, it is a splendid thing to compete for a record according to the fixed rule that a youth of representative coming from the country and area in the world. If they gather in one city and attract attention of people of the whole world, and the people of the various countries, the areas, the races can deepen mutual understanding through sports; there is not such a splendid thing. I want to support our country player in the game of the Olympics by all means, but I am not exclusive at all. I found myself to fairly support the foreign players with respect, honor, surprise and envy for their beautiful performance, a fair play, a good manner, friendship, a great record and effort to the great record.

Brazil is a season of this winter. In Rio de Janeiro, Brazil the mean highest temperature of August is 25.6 degrees Celsius, the mean minimum temperature 18.9 degrees Celsius, though. It is enviable to compare with the temperature in Yokohama where I live as it is the highest temperature 34 degrees Celsius the minimum temperature 28.9 degrees Celsius on August 7, Sunday.
On the other hand, four years later, the 32nd Game of the Olympiad is held in Tokyo. 5 competitions 18 games including baseball, soft ball, Karate and so on are added then. It will plan to be held from July 24 to August 9 in the plan. Temperature of Tokyo of this time in average year is the highest temperature around 30 degrees Celsius and the minimum temperature around 23 degrees Celsius. Japan is in the middle of the summer. How would you think of the competition under such severe temperature?  Why cannot autumn called the best season for Sport in Japan (highest temperature 25 degrees Celsius, minimum temperature around 20 degrees Celsius) be held it? As for it, the holding of the midsummer may make a poor impression of Japan. I cannot agree to OLYMPIC going to excessive commercialization.

It is certain that OLYMPIC makes the heart of world people one through sports. I want to thank Baron Coubertin of French who proposed such a world festival. In addition, I am impressed when I read over the Olympic Charter again. Things prosper with the agreement of many people, and they have to perish when they lose its principle? May it be necessary to get back to the initial enthusiasm once again established by the Baron Coubertin in 1894?

According to the Daily Cargo of the trade paper the number of the waiting  containerships at the end of July rises 142 ships to 269 ships from one year ago and the quantity of loading capacity seems to increase to approximately 2.6 times in 910,000TEU. As for attracting interest, 82% of the total number of the waiting containerships would be occupied by non-shipping companies. On the other hand, approximately 400,000TEU was scrapped in the past one year. It would be difficult to restore the freight rate performed by shipping lines from July on because it was too little for scrapping to take the supply demand balance.

Maersk Line is the top leading Danish shipping company in the world. It is them to have begun upsizing of the containership. They have been dominating in the sea of seven world as the third country shipping line. In addition, they constitute the Alliance called 2M with MSC that is a Swiss shipping company. Maersk Line will start to convert the carrying capacity of eight supersized containership “E class” 11,000TEU ships to 16,500TEU which came out in 2006, from a dry dock in July, because Maersk Line raises competitiveness. They perform the remodeling of the Bulbous Bow of each ships, the exchange of the propeller suitable for slowdown navigation at the same time. Maersk Line converted the carrying capacity of 16 “S class “ 8600TEU type ships into  10,000TEU in 2011. They changed the Bulbous Bow of Panmax type ships in the following year, 2012.

On the other hand, MSC, a partner of 2M participates in a monitoring system of container fleet that CMA CGM supports from the fourth-quarter in this year. They will attach the system to 4,500,000TEU of both companies occupying 25% of the world and it can collect data in real time and they would like to aim at it to be the world standardization of the system.

The new container price of China is $1,400 per 20f for the conventional solvent type paint, $ 1,500 per 20f for the water-based paint which is rather higher $100 per 20f than the conventional one. Factory stock of the Chinese container makers increase a bit to 770,000TEU.

The shipping company kept off the long-term immobilization by the long-term lease with the new container and planned container procurement by MLA lease or on spot lease from depot containers which would be cheaper due to ample depot stock of China, South Asia by leasing companies. The container leasing companies largely reduce deposit stock including China and other Asia except Korea, Taiwan, Malaysia and Singapore.

I think that the situation would be the same in all industries. When you do a same thing as others you cannot increase achievements. We should forecast the future of the industry and we will be required to do in the different way and earlier than anybody else. It would be necessary for us to have some flexibility to try the new thing which could contribute to our company to some extent. We may call it innovative. I think it would make the organization revitalizing if we do something different from before because it would cause a change. If we knock on the stone bridge and pass, it would be hard for us to survive in this business world. Besides we cannot expect the progress if we do the same thing as other people. It is essential for it to be open and to be a flexible organization. The organization which is an inner direction is a problem. It is expected that management listen to advice from outside and they are humbly taking it in the mind that the good thing is good. They should practice without hesitation if they think it right.Maersk Line seems to have it.