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Boxship Recycling Lags 1.8 million TEUs, BIMCO

[ October 23, 2025   //   Gary Burrows ]

Container ship owners and operators are extending a pattern of low recycling activity since 2021, as BIMCO estimates a recycling overhang of at least 500 vessels and 1.8 million twenty-foot equivalent units, or TEUS.

“So far this year, only 10 container ships have been recycled, said Niels Rasmussen, chief shipping analyst at BIMCO, a Danish shipping association for maritime.

The share of ships 20-years-old or older has increased from 16 percent at the beginning of 2020 to 24 percent today and at its highest level since the early 1970s. These ships will make up the bulk of future recycling.

Applying historical recycling patterns, BIMCO placed the average lifecycle for each size segment of the fleet and compared it to the current fleet. For instance, during the period from 2000 to 2019 20 percent of ships were recycled before the age of 20 and 53 percent of ships were recycled before turning 25 years old.

”Prior to the financial crisis a strong market resulted in low recycling, but a weaker market and more recycling dominated from 2009 onwards. Combined, the 2000-2019 period should therefore be a good reflection of recycling during average market conditions,” Rasmussen said.

Given the burgeoning order book, the threat of ship demand erosion if ships return to normal Suez Canal routings, coupled with regulatory requirements to improve ship efficiency and recycling may be higher than BIMCO’s minimum estimate.

Using the earlier recycling of ships during the weaker market conditions of the 2010s to estimate the current maximum recycling overhang of 850 ships and 3.1 million TEUs.

The container tonnage may take years to recycle as the highest ever annual recycling was achieved in 2016 when 185 ships and 600,000 TEUs were recycled.

“Our estimates indicate an overhang of 6 percent to 10 percent of currently trading ships equal to 33 percent to 55 percent of ships older than 20 years. It is worth noting that the estimated overhang is larger than the order book for all ship segments smaller than 8,000 TEUs. This may indicate that fleet growth in the coming years will be driven exclusively by the larger ships which in turn could drive further cascading of larger ships into routes where smaller ships are currently deployed,” Rasmussen said.

Tags: BIMCO