Cabinet Office announced on November 9 that current economy has been over 58 months in September and has exceeded “Izanagi Economy” (57 months) which had the 2nd longest after World War II. If the current economic recovery that has begun in Dec. 2012 would continue till Jan. 2019 it will become the longest one after World War II. However, as an actual feeling, I do not much feel heat of economy. But in view of the congestion of the department store of Saturday, Sunday and the festival day, the crowd of the main railroad station, downtown always seen with many people of men and women, young and old after 5 o’clock on weekdays economic recovery seems to advances steadily and little by little. Advertisements of a few thousands of yen for all-you-can-drink for 2 hours have often caught our eye and it has already been in the middle of November but the gorgeous Christmas sales battle which we used to see seem to have kept a low profile.
On the other hand, in the department store, they do some bargain sale throughout the year. The 100-yen shop loses the temporary curiousness which it used to have and there is almost all I have at hand so it is difficult to look for the thing which I want. Does the value of the thing fall? This sense is considerably always unchanged.
The unemployment rate falls by 0.1% from last month according to the employment statistics in October of the U.S. Department of Labor, and it is 4.1% which is in a low level for the first time in 16 years ten months. The economic recovery in the United States has passed over eight years from July, 2009. European Union (EU) would prospect the real economic growth rate with 2.2% for 2017, 2.1% for 2018 and 1.9% for 2019. The economy of Europe has been already restored gently for five years.
The Chinese greatest trade business talk meeting, Guangzhou Trade Fair ended on November 4. It is held twice a year. The amount of contract of this year is 8.2% increase to 30,160 million dollars compared with the previous fiscal year. It exceeded the result of the previous year for 4 consecutive quarters. It is said that a contract amount of money becomes the index to tell export of coming a half year of China.
Shipping Guide conveys achievements of CIMC, Chinese largest container maker from this January to September. Dry container production recorded 969,300TEU from 419,000TEU, a year earlier and reefer container attained 67,000TEU from 45,300 a year earlier because of container shortage by recovery of global cargo movement and demand by container replacement.
The current new production price is $2,300~2,350 per 20f. The number of the container production this year till the end of October is beyond 2,600,000 TEU, and the new container factory stock is about 530,000TEU at the end of October. As for the total number of the new containers in 2017 it would be considered to be sure more than 3 million TEU this year.
It is surprising to see that the largest container leasing company in the world has placed an order for such enormous quantity of a little less than 700,000TEU as of the end of Oct. I think it may surpass 800,000TEU by the end of the year if they go as it is. What is the reason? Is the reason that they could foresee the opposition of the Royal Family of Saudi Arabia, the rise in the oil prices by the political risk of the oil-producing countries including Iraq with the Kurd problem, the large rise in container price by rise of the steel materials? Is it recovery expansion of the world economy? Is it the ordering competition of the mega containerships by the huge shipping companies according to it? 20,000 TEU containerships are only put in a European route.The European trade volume has the quantity of 15 million TEU a year. However, it could substantially accept 200 of 20,000TEU containership. Therefore, it may still have more room for a mega-containership to come because it has actually been a little over 100 mega-containerships in operation now. Do they foresee it? Anyhow, world economy recovery, expansion of the quantity of trade, the economic development of developing countries lead to marine container increase. Regardless of a container price, it is certain the number of containers are soaring from now on. As long as the leasing demand is guaranteed and container price is relatively cheap container leasing company would order containers because it would make them strong in competition. It could differentiate them from other competitors. On the other hand, the 2nd and 3rd largest container leasing companies ordered the quantity of 50,000-150,000 TEU level this year. Their orders of this year are far powerless against the largest one.
Of course, in order for the leasing company of 5 million TEU levels grows up every year and if at least 10% of total fleet has to replace it by aged deterioration, it is necessary to purchase more than 500,000 TEU every year. Otherwise, they may lose the reputation of the customer by the quality problem of the container of their own and it will cost them higher repair expenses and it will frustrate the management. Their current container utilization ratios seem to maintain 95~97%. The mega leasing companies will be easily covered with a big serious loss if a container market becomes even slightly bad. This is because it is hard for them to accept all of the containers they have leased to shipping lines if they have to return all at the same time to them. The lack of the container storage space at the container depot of the main ports in the world has been pointing out. Besides, the number of container repair companies have been limited and could not overlook the problem of the quality of the container repair, too.
Is that a mega container leasing company necessary for a shipping company, a user or not? The container lease market conditions are easy to clearly determine bad or good. If there is not the container available in the market when they need a shipping company cannot but lease even if the leasing condition becomes expensive. Lease conditions are subject to a seller’s market or a buyer’s market. In the other hand, a shipping company could choose whoever they could be easy to deal with a leasing company if there are many leasing companies to compete as the leasing conditions would be various. It would be hard for shipping companies to differentiate from others if there is little choice in terms offered by leasing companies. I think that there is the way which a small and medium size leasing companies could survives.