Contents
Table of Contents
Dry Cargo
Golden Weak
With the advent of Golden Week holidays in China we have already seen the repercussions in the dry freight market with yesterday’s indices showing the first falls in all sizes for some time. History has shown us that this decline can generally last for about a month with different degrees of pain and it remains to be seen what this will year will bring, but on the flip side the post drop inevitable recovery is also variable on whether it’s a quick and strong improvement or otherwise.
Interest in dry cargo vessels remains buoyant with reported sales across all sectors. Prices seem to remain relatively static although there does appear to be a few anomalies. For instance, the sale of the Greek-controlled kamsarmax “MAGIC ARGO” (82,238 dwt / built 2009 Oshima, Japan) at US$15.75m looks like an attractive price for buyers, given the last similar sale in was back in May with the “THALASSIC” (81,426 dwt / built 2009 Universal, Japan) at a very strong US$21m. Similarly, Swires are reported to have sold three handy bulkers built 2015 for US$19.5m each, it was only back in March they committed three one-year older sisters to the same buyers for a price in low 20’s. On the ultramax side we understand the Japanese controlled “SANTA VICTORIA” (61,434 dwt / built 2012 Iwagi, Japan), which invited offers this week, has seen US$19.5m and given the year newer “LOWLANDS BREEZE” was sold in early September for US$20.8m we anticipate this vessel will likely be committed soon. Offers were invited today for kamsarmax “AOM GEORGINA” (82,146 dwt / built 2014 Tsuneishi Cebu, Philippines) and given that the vessel is scrubber-fitted owners will be looking to conclude at levels substantially above those achieved by the year older, unscrubbered “NAVIOS SOUTHERN STAR”, which was concluded in August for region US$21.8m.
Tankers
Steady Eddie
Keen followers of second-hand tanker markets could be forgiven for feeling a little underwhelmed by the current state of affairs. An unusually active August had appeared to presage an aggressive end to Q3 and start to Q4, with multiple buyers lining up to compete on some vessels, particularly on the clean side. While recent weeks have indeed seen a steady string of fixtures reported, the feeling is now rather one of steady trading rather than frantic competition, as the pool of actual buyers is beginning to look more like a pond than a lake.
So much for the demand side; on the supply side of things, the reality is that the inventory of vessels actively or potentially for sale is simply too ample for anything but the most seismic of freight rate shocks to really push prices up any higher. While such shocks could yet happen given the volatile global economic and political landscape, for the time being liquidity and prices seem set to continue at their current pace.
Newbuilding
Tanker Temperament
Further suezmax orders are emerging in Japanese yards confirming earlier reported activity. The Japanese have been able to be competitive at low US 80s mill with the slide in the Yen, but increased interest has now pushed pricing back up toward mid USD 80s mill level. Interest continues in MRs as owners note the lack of investment, or likely investment, in the MR1 and LR1 sectors. This should benefit MRs as those respective ships have a significant proportion of vessels 15yrs+ of age. Bulker activity continues on the medium sizes and in some of the second-tier Chinese yards these are taking tanker suitable slots creating more uncertainty for tanker owners looking to order but with the ‘when’ question holding them back.
Recycling
Positivity
A fairly lacklustre week in the world of ship recycling with just a few sales to report (most of those sales being reported this week are in fact old ones that have come to light). There appears to be a speculative offers / acceptances on some ships being negotiated, which would indicate the on sale price from the breakers themselves may not necessarily be in line with what the cash buyers have paid, although there is no denying prices are pretty firm. This could be positive sentiments that prices will hold firm, but in part this could also be because of the stiff competition on what appears to be just a relatively small amount of sales candidates on offer. The Indian market is still paying top dollar and you would expect most tonnage currently being sold should find its way to the beaches of Alang, and whilst Pakistan is a close second, and Bangladesh a distant third, the fact that India is the only destination where there are no L/C problems (both Pakistan and Bangladesh continue to grapple with Letters of Credit issues) this gives them an added edge when offering and getting tonnage delivered.
S&P Sales
| Vessel Name | DWT | Built | Shipyard (Country) | Buyer | Price (US$ mill) | Notes |
| BULKERS | ||||||
| BLUE HORIZON + CLEAR HORIZON | 207,900 | both 2012 | NACKS (China) | Neu Seeschiffahrt | 30.5 each | DD due 5+8/25. BWTS. |
| NAVIOS BEAUFIKS | 180,310 | 2004 | Koyo (Japan) | Undisclosed | reg 13 | DD due 10/24. |
| SUIGO | 174,802 | 2011 | Namura (Japan) | Greek buyer | 23.5 | DD due 8/24. BWTS. |
| MAGIC ARGO | 82,338 | 2009 | Oshima (Japan) | Greek buyer | 15.75 | DD due 6/24. BWTS. |
| XING HONG DA 8 | 57,790 | 2012 | Yangzhou Dayang (China) | Chinese buyer | 12.7 | DD due 1/25. |
| SUPRA THESSAL | 57,017 | 2010 | Qingshan (China) | Indonesian buyer | 11.5 | SS due 1/25. BWTS. |
| HEILAN SONG | 56,851 | 2011 | Tianjin Xingang (China) | Undisclosed | 13.1 | DD due 12/24. BWTS. |
| KOUROUPI | 56,047 | 2008 | Mitsui (Japan) | Indonesian buyer | 14.2 | DD due 3/25. BWTS. |
| JAG ROHAN | 52,450 | 2006 | Tsuneishi Cebu (Philippines) | Undisclosed | 9.15 | DD due 1/24. BWTS. |
| FENGNING + FOOCHOW + FUNING | 39,800 | all 2015 | Chengxi (China) | JP Morgan | 19.5 each | SS due 1+8+10/25. BWTS. Logs. |
| GOLD OAK | 37,732 | 2017 | Shimanami (Japan) | Undisclosed | 24 | BBHP deal. DD due 12/25. BWTS. Logs. |
| COPACABANA | 37,202 | 2011 | Saiki (Japan) | Chinese buyer | 15.35 | OHBC. SS due 9/25. BWTS. |
| PURPLE SEA | 35,214 | 2011 | Nantong Changqingsha (China) | Undisclosed | high 10 | DD due 6/24. BWTS. Logs. |
| 21 LUCKY | 29,756 | 2001 | Shikoku (Japan) | Undisclosed | 5.5 | DD due 9/24. BWTS. Logs. |
| UNI AUC ONE | 28,709 | 2007 | Shin Kochi (Japan) | Undisclosed | 7.8 | DD due 10/25. BWTS. Logs. |
| GLORIOUS JUPITER | 26,091 | 2013 | Shin Kurushima (Japan) | Undisclosed | 13.7 | SS psd 8/23. BWTS. |
| GENERAL CARGO / TWEEN / MULTI-PURPOSE | ||||||
| SEACON YOKOHAMA | 13,500 | 2023 | Murakami Hide (Japan) | Bank of Beijing FL | 21.25 | 10 yrs BB back.. P/opt at yr5, p/obl end term. |
| TANKERS | ||||||
| PYXIS EPSILON | 50,124 | 2015 | SPP (Korea) | TBN (for Military Sealift tender) | 40.75 | Deepwell. SS due 1/25. BWTS. |
| SHANDONG ZIHE | 40,059 | 2004 | Shina (Korea) | Undisclosed | 14.45 * | Auction sale. SS due 3/24. |
| CONTAINERS / RO-RO / REEFER / PCC | ||||||
| HAMBURG TRADER | 13,710 | 2005 | Jiangsu Jinling (China) | Undisclosed | reg 6 | Ice 1A Super. 1,118 TEU. Geared. DD due 4/24. |
Newbuilding Orders
| Ordering Client | Vessel Type | Size / No. of units | Shipyard (Country) | Delivery | Price (US$ mill) | Notes |
| BULKERS | ||||||
| Diana Shipping | Kamsarmax | 81,200 dwt x 2 | Tsuneishi Zhoushan (China) | 2027-2028 | 46 | LOI. Methanol dual-fuel. |
| Shoei Kisen | Ultramax | 64,000 dwt x 4 | JMU (Japan) | 2026 | Against TC to Ultrabulk. | |
| AVIC Leasing | Ultramax | 64,000 dwt x 4 | New Dayang (China) | 2026 | 32 | Heavy down-payment. |
| GENERAL CARGO / TWEEN / MULTI-PURPOSE | ||||||
| Weihai Weitong | General Cargo | 14,000 dwt x 1 | Weihai Donghai (China) | 2025 | ||
| CONTAINERS / RO-RO / REEFER / PCC | ||||||
| CMA CGM | Containership | 9,200 TEU x 8 | SWS (China) | 2026-2027 | ||
| CK Line | Containership | 2,700 TEU x 2 | Huangpu Wenchong (China) | 2025-2026 | reg 37 | |
Recycling Activity
| Vessel Name | BUILT | DWT | LWT | Delivery | Price ($/lwt) | Notes |
| BULKERS | ||||||
| ABDULLAH | 1996 (Japan) | 45,653 | 7,528 | Bangladesh | ||
| HASEEN | 1998 (Japan) | 46,750 | 7,635 | India | ||
| TYCOON | 2000 (China) | 74,716 | 12,627 | India | 570 | incl 550 tons of bunkers ROB |
| YA TAI 1 | 1995 (Japan) | 63,045 | 10,399 | as-is China | 475 | to be recycled in India |
| TANKERS | ||||||
| IRMA DULCE | 2023 (Brazil) | 72,900 | 13,400 | as-is Brazil | old sale | |
| ZULIA GATTAI | 2023 (Brazil) | 72,900 | 13,400 | as-is Brazil | old sale | |
| CONTAINERS / RO-RO / REEFER / PCC | ||||||
| MSC MARIA | 1993 (Germany) | 9,355 | 3,952 | India | 547 | HKC Green Recycling |
| FORTUNE TRADER | 1994 (Japan) | 24,444 | 7,078 | India | 612 | |
| GSS YANGON | 1993 (Japan) | 18,166 | 5,866 | as-is Singapore | 530 | |
| TAXIARCHIS | 1976 (Norway) | 4,333 | 5,326 | Turkey | ||
| DAPITAN BAY 1 | 1992 (Japan) | 4,485 | 5,899 | Bangladesh | 530 | |
Recycling Prices (US$/LDT)
| Vessel Type | India | Pakistan | Bangladesh | Turkey |
| Tankers / Cont / Ro-Ro / Capes / PCC / LPG / LNG | 575 – 605 | 560 – 585 | 515 – 525 | 320 – 330 |
| Bulkers / Tween / General Cargo | 560 – 575 | 550 – 560 | 500 – 510 | 310 – 320 |
Newbuild & Second Hand Prices
| Newbuild & Second Hand Benchmark Values ($ million) | Historical Average Values ($ million) | ||||
| Vessel Type | New Building | 5 Year Old Vessel (Built 2018) | 10 Year Old Vessel (Built 2013) | 10 Year Old Vessel~ (10 Years Average) | % Difference Present vs Historical |
| Tankers | |||||
| VLCC | 127.5 | 98.5 | 74 | 49.3 | 50.1% |
| Suezmax | 85 | 73 | 58 | 35.1 | 65.2% |
| Aframax | 69 | 63.5 | 51 | 27.4 | 86.1% |
| MR | 47 | 40.5 | 32 | 19.5 | 64.1% |
| Bulkers | |||||
| Capesize | 64.5^ | 47.5 (eco) | 29.5 | 24.5 | 20.4% |
| Kamsarmax | 35^ | 32 | 23 | 16.8 | 36.9% |
| Ultramax / Supramax | 33^ | 28.5 | 19 | 14.4 | 35.4% |
| Handysize | 30^ | 24.25 | 16.5 | 11.8 | 39.8% |
| ^ Chinese price (otherwise based upon Japanese / Korean country of build) | ~ Basis standard contemporaneous DWT/spec for each type | ||||
Contact Details
Brokers
| Maria Anagnostou | T +44 (0)207 667 1233 | M +44 (0)784 626 9546 | WA / WC |
| David Cundy | T +44 (0)20 7667 1150 | M +44 (0)77 4832 0896 | S davidcundy1 |
| Daniel Gifford | M +44 (0)20 7667 1150 | M +30 6949 455588 | |
| Anuj Gosalia | M +91 9820 229999 | S anujudaygosalia | |
| David Hawkins | T +44 (0)20 7667 1151 | M +44 (0)77 8829 9249 | |
| Rupert Scott-Hughes | T +44 (0)20 7667 1241 | M +44 (0)77 7091 5543 | S rupert_sh |
| Gerrit Stricker | T +44 (0)20 7667 1194 | M +44 (0)74 2766 3384 | S gerritstricker |
Valuations
| Stuart Koenig-Roach | T +44 (0)20 7667 1238 | M +44 (0) 78 94 724868 | S s_koenig_roach |
sap@eagibson.co.uk
