Slow steaming in container shipping

Since 2007, shipping lines started to implement slow steaming by reducing their vessels’ commercial speed from 22-23 knots to 18 knots or even slower (the so-called super slow steaming). Slow steaming was initially used to realize fuel cost savings in a period when the bunker price was rising fast. For example, the fuel cost per ton of IFO380 in Rotterdam increased from USD 220 in January 2007 to a peak of more than USD 700 in mid-July 2008. After the start of the economic and financial crisis, bunker prices dropped to less than USD 200 per ton in December 2008 and then fluctuated between USD 400 and 700 in the period 2010-2019. Today, slow steaming is not only a way to reduce ship operating costs, but it has also become a way to absorb vessel overcapacity in the market and to reduce ship emissions.

Slow steaming has become common practice on the main trade routes. Container lines have no plans to speed up ships despite the call of shippers for shorter transit times. The question arises whether existing shipping lines will ever consider offering faster shipping services with a smaller vessel capacity than the ships currently sailing between Asia and Europe, but at the same time offering a much faster transit time, at higher schedule reliability, and, unavoidably, a higher freight rate. Such a service could target volume-based high-value and time-sensitive cargo. It is highly unlikely the major container carriers will fill this gap in the foreseeable future. They are busy controlling costs by focusing on scale and trying to improve schedule reliability. If the gap is ever to be filled, the initiative will most likely come from outsiders, not active in the large-scale container business today.