by Lloyd's List

30 August 2024 (Lloyd's List) - COSCO Shipping Holdings, which controls the world’s fourth largest containership fleet, has announced orders worth about $2.2bn for a dozen methanol-fueled 14,000 teu vessels.

The fresh tonnage, each priced at $179.5m, will be built at sister company Cosco Shipping Heavy Industry (Yangzhou) with deliveries scheduled between May 2027 and March 2029.

Shanghai and Hong Kong-listed CSH said the newbuilding project is part of the company's decarbonisation efforts and will help maintain its fleet scale among the top tier of the industry.

This marks the company's first major containership newbuilding contract since placing an order for 12 methanol-powered 24,000 teu vessels in 2020.

The move comes as carriers embark on a second ordering spree since the pandemic, following freight rate increases due to disruptions in the Red Sea, which have refilled their coffers.

Including Cosco's latest order, the global containership orderbook has reached 179 ships year-to-date, of which 77 were placed in June alone, according to Clarksons data. This is close to the 195 ships ordered for the whole of 2023, but still way below the 446 ships of 2022.

The top three carriers ahead of the Chinese company - Mediterranean Shipping Co, Maersk and CMA CGM - are also actively pushing forward their ordering and fleet renewal plans.

Maersk earlier this month announced it would further implement its newbuilding schemes of about 80 ships in total, and confirmed its pivot towards using bio-LNG, an alternative fuel the carrier had previously dismissed.

With the 12-ship order, Cosco's boxship orderbook capacity is boosted to about 800,000 teu, second only to MSC and CMA CGM. However, Maersk's decision does not appear to have altered Cosco's continued commitment to methanol, whose application faces critical challenges, including scarce supply and high prices.

The company has stepped up investment in methanol as a marine fuel in recent years, beyond simply ordering new ships.

It agreed last September with State Power Investment and Shanghai International Port Group to jointly develop a full industry chain project for methanol marine fuel.

The bio-methanol plant in Jilin province invested in by their joint venture Shanghai Jiyuan Green Energy received regulatory approval earlier this year.

The facility is expected to be completed in November 2026 with an annual capacity of 200,000 tonnes.