Container ship charter rates are at their highest in four years, even as the ships that will end the rally sit on order books1.
Braemar's charter index was 325.8 on 23 October, up 21% from a year earlier and the highest since autumn 20221. Fixtures fell 15% to 853 in the year to 17 October, and capacity fixed fell 10% to 2.54m teu1.
Linerlytica puts the container orderbook at 16.2m teu, equal to 46.5% of the active fleet and the highest share since 20092. BIMCO counts the whole shipyard orderbook, all ship types, at 203.2m compensated gross tonnage (cgt) on 1 September, up 13% from 180.0m cgt a year earlier3.
For buyers signing 2027 contracts, the question is which trades receive that capacity first.
Why charters are tight while ships are on order
Braemar blames a shortage of prompt tonnage, because owners locked ships into long-term employment in 2024 and 20251. Charterers are booking further ahead. Ships are fixed an average of 7.8 months before delivery, up from 6.8 months a year earlier, and lead times exceed 10 months for vessels of 3,000 teu and above1.
Small ships are tightest. Vessels of 1,500 to 1,900 teu fixed for nine to 15 months earned a median $28,625 a day, up 18% year on year1.
Old ships are not leaving the fleet. Seatrade Maritime reported that demolition rates remain at basement levels5, and cash buyer Best Oasis describes a "near-dry supply of vessels" for recycling6. Euroseas fixed a 25-year-old 2,556 teu feeder at $62,500 a day for 12 to 14 months, more than double its previous rate7. It sold the sistership for $26m rather than scrap it7. The new ships will land on top of a fleet that already absorbs 20-year-old tonnage1.
The wave is concentrated in the biggest ships
Chinese yards booked a record 4.94m teu this year, or 88% of the capacity ordered, according to Linerlytica2. Hengli Heavy Industries won orders for 52 ultra-large dual-fuel ships: 20 of 24,000 teu, 20 of 19,000 teu and 12 of 22,000 teu2. The 24,000 teu orders are believed to be for MSC, The Loadstar reported2. Maersk is seeking quotes for a dozen 24,000 teu ships. Brokers link CMA CGM to 12 more at Yangzijiang, which the line has not confirmed2.
BIMCO's delivery schedule shows the timing. Combined output from China, South Korea and Japan peaked at 40.1m cgt in 2025, with 55.9m cgt due in 2027 and 60.0m cgt in 20283. Chinese yards alone are due to deliver 44.0m cgt in 2028, nearly twice the 22.7m cgt delivered in 2025, BIMCO's Niels Rasmussen said3. Container ships are 30% of cgt on order and 68% of the past year's growth3.
Since January 2025, 94 fixtures covering about 570,000 teu were for newbuildings delivering in 2028, Braemar said1. "Charterers are queuing today. By 2028, owners may be the ones in the queue," its analyst Jonathan Roach said1.
Which trades get relief first
Asia-Europe and Asia-Med should feel it first. The orderbook's centre of gravity is 19,000 to 24,000 teu ships, which work the long east-west routes2. Suez is reopening at the same time. Alphaliner found 63% of Far East-Europe capacity has returned to the Red Sea, with 24 of 46 direct services transiting Suez4. Containers moving via Suez now top 5.5m teu, out of 8.7m teu available to the trades4.
Lloyd's List Intelligence reported 2.19m teu of containership cargo through Suez in September, the most since the Houthi campaign began8. Drewry counted 55 containership transits in the week to 18 October, 120% more than a year earlier9. Analyst Lars Jensen estimated Suez routing was back to roughly 30% to 35% of normal10. Maersk and Hapag-Lloyd expect nearly all Gemini services to use Suez in the first quarter of 2027, Hapag-Lloyd chief executive Rolf Habben Jansen said10.
Shorter voyages release effective capacity without a new ship arriving11. Freightos said that raises overcapacity risk in 202711. Demand will not fill the gap. Sea-Intelligence, citing the IMF's October outlook, said world trade volume growth slows to 4.7% in 2027 from 5.0% in 202512.
India's trades sit at the back of the queue. The orderbook does not match the ships that serve India. HMM's eight 13,000 teu ships, due from 2029 on its Far East-India-Mediterranean loop, are the largest newbuild tied to an India service in this batch13. HMM says it will focus on mid-size and smaller ships, and it bought four second-hand feeders13. Euroseas has 12 ships of 1,800 to 4,484 teu due between 2027 and 20297. Regional Container Lines is adding a second 1,100 teu ship to a Far East-India loop14. Those ships set capacity on Indian feeder legs, and their charter market is running 18% above last year1.
Structuring a 2027 contract
Carriers are using blank sailings to defend price. Drewry counted eight announced for next week, up from two this week15. MSC will apply a rate of $4,500 per 40ft on Asia-North Europe from 1 November, and Linerlytica expects the November pricing to fail15. Blank sailings protect carrier revenue, but they also move contracted cargo, so reliability should be priced in.
First, split the negotiation by trade. On Asia-Europe and Asia-Med, where big ships and the Suez return both land, a 24-month fixed rate locks in today's tightness. A 12-month rate with an indexed extension, or a collar with a floor and cap, keeps some of the expected relief.
Second, on India lanes, space and equipment commitments matter more than a few dollars on the rate. Feeder capacity is scarce and getting dearer1, and new mid-size tonnage for India arrives from 202913. Slots, equipment and rollover priority are worth more than a rate that cannot be served.
Third, carriers' costs are high. Braemar says charter costs have run at roughly double their 2021 to 2024 average relative to freight rates1. Carriers paying those rates will resist cuts, so index-linked deals may lag the spot market on the way down.
What to watch
The direction is set. The timing is not.