Market at a glance:
Newbuilding market — A busy week for new order contracting, in particular the dry sector which saw orders from Handysize up to VLOC—the first such orders in over three years. Chinese yard picked up orders for at least 8 tankers, including 2 MRs ordered by Tsakos Energy Navigation, taking its order book to 10 vessels. Investment in anticipation of a growing ammonia trade continued, with the largest carriers to date ordered by Eastern Pacific and news a deal at Hyundai HI ‘split’ by Eastern Pacific and Capital Gas.
Secondhand market — Dry bulk sector continued with a modest number of transactions for yet another week, seemingly having entered a recovery mode. Supramax segment prevailed as the leading one at this point, whilst, fresh appetite for Capesize units seems being under slight pressure. In the tanker sector, things appeared considerably more fervent, with interest fairly good distributed across the different sizes.
Ship recycling market — A considerably more active week than the last, as 4 container vessels of over 40,000 LDT combined were committed for recycling taking the total number of container vessels sold for demolition to over 60, versus the 10 recycled throughout 2022. Dry bulk also continues ahead of last year’s pace, while the YTD tanker dwt scrapped is just over 20% of the amount recycled through to August last year.
Dry bulk
Capesize – The autumn began on a favourable tone for the dry bulk sector overall, with the BDI rate supported mostly by the positive trend in the biggest size segment. After roughly a month of a bearish trend, the BCI-TCE took a notable upward step, succeeding in a rise of 24.9% week-on-week, closing time on Friday at US$ 10,693/day. All regions demonstrated an improving trend, but positive momentum appears mostly contained in the Atlantic region for the time being.
Panamax – It was a quiet week for the Panamax market and the BPI-TCE exhibited only a slight uptick in earnings, supported mainly by the routes in the Pacific arena. Contrary to this, demand in the Atlantic appeared relatively limited, with these fixing levels offering negative pressure.
Supramax – Tonnage demand for smaller size vessels remained fairly ample for a third consecutive week, causing overall earnings to retain a steady upward trend. Last week, the BSI-TCE increased by 10,1%, exceeding its average over the last 12 months.
Handysize – The spot rates in the Handysize market continued with positive momentum for over a month now, having reached in excess of the US$ 10,000/day mark at this point. Fresh demand from the Atlantic provided adequate support in the market.
Tanker
VLCC – Things in the bigger size segment resumed on a disappointing tone for yet another week, with the respective TCE rate having sunk further into the negative territory, as the scene across most key trade areas remained fairly sluggish. That being said, forward sentiment remains on the bullish side, which can be seen in the period charter market, with the 1yr period TC rate, on monthly average basis, currently enjoying its highest returns of over the past 6 months or so.
Suezmax – A rather flat week for the Suezmax size segment, which saw its spot TCE figure just moving marginally on a w-o-w basis. West African earnings found some form of support as of late and have actually managed a small increase. At the same time, on monthly average, the 1 year period charter rate remains at its lowest seen in the year so far.
Aframax – It was a bad week for the Aframax market too, which saw significant corrections across many key trade regions, keeping the overall market on a downward trajectory for some time now. As a result, on monthly average, both the spot and 1yr period rates traded at their lowest levels on a year to-date basis.
MR — Once again, we noticed split fortunes across Atlantic and Pacific basins. The former lost its recent period high levels, while the Pacific market posted a considerable increase, creating a “ spread” of around US$ 6,000/day on its favour at this point.
Sale and purchase
Newbuilding orders
A substantial number of newbuilding orders have come to light over the past week, with bulk carrier orders at the fore, with 11 orders across the Handysize, Panamax and Capesize size segments. Chinese yards continue to lead the number bulker contracts, holding in excess of 75% of the number of vessels contracted this year, although dry bulk contracting overall remains below the pace of 2022, with a little over 300 vessels ordered to date this year. Winning’s order takes the number methanol DF/ready bulkers ordered this year and the vessels are set to join their fleet in the bauxite trade.In the tanker sector, contracting activity remains high relative to last year, the combined number of crude and product tankers having surpassed last year’s total around the middle of this year thanks to a rush of activity when 100+ tankers were ordered throughout June and July. August witnessed roughly half of the tankers order as the month before, and it remains to be seen whether September will return to such levels.
Second hand sales
On the dry bulk side, the flow of fresh transactions was sustained at fairly modest levels for yet another week, with many already anticipating some sort of recovery in the near term. Not withstanding this, snp activity can hardly avoid a much less productive 3rd quarter on year-on-year basis. In terms of current trends, we notice that Supramax sales have gained momentum in terms of past 4 week activity metrics. The Capesize segment on the other hand, despite its relative strong year-to-date performance in terms of volume, has somehow lost traction as of the past couple of weeks or so.
On the tanker side, a strong shift in trend took place over the past week, with a decent number of units changing hands. However, thinking about the current view in spot earnings indicates that things will prevail more volatile in the near term.
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Source : Cyprus shipping
