Chartering prices still in the red

Chartering prices, as expressed by the CONTEX, a chartering index published by the Hamburg Ship-brokers Association continue to be in the red. The index is published every Tuesday and Thursday. Chartering prices are in a fundamental way the result of a dynamic balance between supply of and demand for vessels.

The index had lost 80% of its value during the first 18 months of the crisis and recovered almost half of its losses in the subsequent 12 months. It has been retreating again ever since and it is still in a negative trend the last weeks. A part of the relative oversupply which suppresses prices can be attributed to newly built vessel capacity entering the market and another part is the result of a generally negative economic climate (this is the interesting part) and the resulting competition in the Containership Chartering market. It is unclear which factor explains what but if ship owners’ unfulfilled expectations are of any value the index says nothing good about current economic prospects.

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