BIMCO’s latest Shipping Number of the Week highlights a growing overhang in container ship recycling, estimated at a minimum of 500 ships or 1.8 million TEU, according to Chief Shipping Analyst Niels Rasmussen.
“So far this year, only 10 container ships have been recycled,” Rasmussen notes. “This continues a trend of low recycling activity since 2021 as many ships remain in operation beyond their typical recycling age.”
The share of ships aged 20 years or older has risen from 16% in 2020 to 24% today, marking the highest level since the early 1970s. These older vessels are expected to make up the bulk of future recycling.
Based on historical patterns from 2000 to 2019, BIMCO found that 20% of ships were recycled before reaching 20 years, and 53% before 25 years. Using this benchmark, the current minimum recycling overhang stands at 500 ships (1.8m TEU).
Rasmussen adds: “Before the financial crisis, strong markets kept recycling low, but weaker conditions later boosted it. The 2000–2019 average gives a fair picture of normal market behavior.”
However, with a large order book, potential demand shifts if Suez Canal routes normalize, and stricter efficiency regulations, actual recycling could exceed these estimates. Under weaker 2010s market conditions, BIMCO calculates a maximum overhang of 850 ships (3.1m TEU).
Even so, clearing this backlog will take time, the record year for recycling was 2016, when just 185 ships (0.6m TEU)were scrapped.
“Recycling volumes remain hard to predict,” Rasmussen concludes. “But the current overhang represents 6–10% of the active fleet, or up to 55% of ships older than 20 years. This may mean future fleet growth will come mainly from larger vessels, pushing more big ships into smaller trade routes.”
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