The capacity of the container ship fleet has increased by 1.6 million Twenty-Foot Equivalent Units (TEU) since the beginning of the year.

Compared to one year ago, the capacity has risen by 11% to 29.5 million TEU, marking the fastest fleet growth in 15 years.

Niels Rasmussen, chief shipping analyst at BIMCO, said the delivery of new ships reached a new high during the first half of 2024, with a total of 264 ships with a combined capacity of 1.6 million TEUs delivered from shipyards, two-thirds more than during the first half of last year, when the previous record was set. 

He noted that though a new benchmark has not been set, high demand for ships has contributed to keeping ship recycling at a low level.

Strong cargo volume growth and the rerouting of ships via the Cape of Good Hope have also contributed to the recycling of only 36 ships with a combined capacity of 51k TEU.

"Despite the record, shipowners have continued to place orders for new ships. Year-to-date, a total of 63 ships with a combined 0.4 million TEU capacity have been ordered, and the order book-to-fleet ratio remains high at 19%," Rasmussen said.

BIMCO noted that the order book already contains orders for delivery in 2028, and an average of 1.5m TEUs are scheduled for delivery each year between 2025 and 2027.

The combined capacity of 12k-17k TEU ships has grown the fastest — now the largest within the container fleet, making up 22%.

The segment's capacity grew 25% year over year (YoY), which made up nearly 50% of the overall fleet's growth.

"In fact, the 12k-17k TEU segment of ships was also the main driver of growth during 2022 and 2023. In addition, the segment will also dominate growth in the coming years as it makes up more than 50% of the capacity on order," BIMCO, one of the largest international shipping associations representing shipowners, said.

It added that ships larger than 17k TEU dominated growth during 2015-2021 but only made up 17% of the capacity in the order book.

Shipowners' focus has shifted from the larger ships as they are operationally limited to ports in Asia and Europe, and the 212 ships already in service cover most of these trade lanes.

"The container fleet's capacity is expected to exceed 30 million TEU for the first time at the end of the 3rd quarter and hit 30.5 million by the end of 2024," Rasmussen said in the new report.

He added that by the end of 2027, the current order book will add another 4.3 million TEU.

"As cargo volume growth is unlikely to match this expansion, we expect ship recycling to increase and temper overall fleet growth. In addition, if ships can eventually return to the Red Sea and the Suez Canal, demand for ships will fall," Rasmussen further said.

The BIMCO chief shipping analyst examined the capacity expansion of the container fleet, which has experienced the fastest growth in 15 years compared to one year ago.