HMM Orders $1.4B in Ships as Container Capacity Grows

In brief: HMM ordered eight large container ships for about $1.4 billion, adding to the biggest orderbook for new container ships since 2009.

Implications:

Contracts: New ships are arriving faster than trade is growing, which gives you room to push back on 2027 increases.
Timing: Transpacific spot rates are still high because of cancelled sailings, weather delays and congestion at Shanghai, so don’t plan on relief this quarter.

The News

HMM, South Korea’s largest container line, ordered eight ships that each carry about 13,000 twenty-foot containers (TEU) from HD Hyundai, in a deal worth about $1.4 billion. The ships can run on liquefied natural gas or regular marine fuel, and deliveries start around 2029. HMM will put them on its Far East-India-Mediterranean service, not on routes to North America. It also bought four smaller feeder ships for regional routes.

The order, along with a recent MSC order for 20 ships of 24,000 TEU each, pushed the global orderbook to 16.2 million TEU. That equals 46.5% of the fleet already sailing, the highest share since 2009, according to Linerlytica. Industry executives have warned the orders raise the risk of overcapacity.

HMM wants to grow to about 1.5 million TEU of capacity, from 1.034 million today. It has invested more than $4.5 billion this year in ships, logistics and technology, including this order.

Why It Matters

Carriers are building ships faster than trade is growing, and that shifts bargaining power toward importers as the new space arrives over the next few years.

Not your lane, still your price: HMM’s new ships won’t call at US ports, but carriers move ships between trades, so space added on Asia-Europe frees other ships that can be sent to the transpacific.
Suez adds more: Carriers expect to stop routing ships around Africa by the end of March 2027, which frees about another 1 million TEU of space, while global container volumes are up 4.8% so far this year.
Rates remain elevated: Shanghai to Los Angeles spot rates were $7,884 per 40-foot container on Drewry’s World Container Index last week, held up by cancelled sailings, weather delays and congestion at Shanghai. The war that cut traffic through Hormuz still shapes routing too.

What It Costs

An importer moving 500 forty-foot containers a year from Shanghai to Los Angeles at last week’s spot rate, for example, would pay about $3.9 million, by our math. Every 10% you take off that rate in 2027 talks saves about $394,000 a year.

Who’s Exposed

Spot and short-term buyers: You feel rate moves first, up or down, so a capacity glut reaches you before contract shippers.
Spring contract signers: Most transpacific annual contracts renew around May 1, after carriers expect the Suez return to be complete, which is when the extra space should show up in bids.
East Coast importers: Shanghai to New York spot rates were $10,075 per 40-foot container last week, and Asia-East Coast services that can go back through Suez stand to gain the most space.