Bulkers And Tankers Slow Steam To Prop Up Rates

The maritime industry is witnessing a significant shift in operational strategies as deep-sea ocean carriers, particularly in the bulk cargo sector, use slow steaming to combat overcapacity, plunging rates and rising environmental pressures.

According to recent data from Clarksons Research, average speeds across the deep sea cargo fleet hit new lows in the first quarter of this year.

This trend is particularly pronounced in sectors facing commercial challenges, such as the liquefied natural gas LNG space, where speeds have decreased by 2 compared to the 2024 average, now averaging 14.6 knots 27.04km p/h.

Bulk carriers have also slowed down by 1.7, moving at a record low of 10.7 knots, while product tankers are 1.7 slower at 11.2 knots.

In addition to environmental considerations, slow steaming serves as a strategic tool for managing capacity in a market where supply often outstrips demand, causing a drop in freight rates.

By reducing speed, carriers can effectively limit the supply of available shipping capacity, which can help stabilise freight rates in a challenging market environment.

This strategy is reminiscent of the 'super slow steaming' tactics seen during periods of significant supply-demand imbalances, such as the aftermath of the global financial crisis in 2008.

Beyond its role in capacity management, slow steaming is a key strategy for reducing greenhouse gas emissions and meeting stringent environmental regulations.

The Carbon Intensity Indicator CII and other emissions standards are driving shipowners to explore cost-effective ways to decarbonise their operations.

According to John Maggs of the Clean Shipping Coalition, reducing a ship's speed by 10 can lower emissions by almost 20.

This approach is particularly appealing for older vessels, where slow steaming can be a more economical alternative to costly retrofits or newbuilds.

Since 2008, speeds have decreased by 20-30 across most shipping sectors.This downward trajectory reflects both economic pressures and the increasing importance of environmental compliance.