Newbuilding orders have gone missing and are Absent Without Official Leave (AWOL), to borrow a popular term, as has been the trend since the start of the year. In its latest weekly report, shipbroker Allied Shipbroking noted that “Troubles continue to surface with the lack of orders adding further and further pressure on the market and on all shipbuilders. The IMF recently pointed out the implicated cost it would take on S. Korea’s market to restructure the corporate debt that has amassed in it’s shipping and shipbuilding industry, while pointing out that the accumulated benefits of a proper restructuring could be offset in about 10 years.”
“The problem however becomes more and more urgent as lacking new orders and delays in deliveries and re-negotiations on old contracts create further havoc on their cash flows. Given that most shipbuilders worldwide rely heavily on new orders in order to safeguard the coverage of their fixed costs and keep their operations going, the fact that there is little incline as to an improvement in buying interest for newbuildings over the next 6-12 months means that there is still a considerable time period to go before they can even hope for a sigh of relief”, said Allied Shipbroking.
Meanwhile, things in the S&P market are quite the opposite as shipowners are still targeting modern dry bulk tonnage. In its latest note, VesselsValue said that “Bulker vessels have firmed in value. The Capesize vessel Gaia Pegasus (229,200 DWT, 2004, Namura) sold by NYK line to Samos Steamship for USD 12.7 mil vs VV value USD 11.46 mil. Panamax vessels have seen a slight firming in values, the Barock (82,700 DWT, 2007, Tadotsu Tsuneishi) sold for a firm USD 10.4 mil vs VV value USD 10.06 mil. Older tonnage also demonstrates a firming with the sale of the Red Queen (76,800 DWT, 2005, Sasebo) for USD 3.9 mil vs VV value USD 3.6 mil. The Supramax bulker Falcon trader 2 (54,900 DWT, 2009, Oshima) offloaded by Nisshin Shipping for USD 11.8 mil vs VV value USD 11.56 mil, demonstrating stable values”.
Meanwhile, according to the ship specialist, “The tanker sector has seen a softening in the Suezmax, Aframax and LR1 values, particularly older tonnage, this is due to a number of negotiations taking place. MR values have remained stable with a slight firming in newer tonnage. The VLCC sale of the Astro chorus (305,700 DWT, 2001, Daewoo) offloaded by Maran Tankers, has firmed values selling for USD 24.5 mil vs VV value at USD 24.39 mil. No reported sales within the Container sector this week”, said the shipbroker.
In a separate note, Allied Shipbroking said that “On the dry bulk side, activity is still holding firm, with a number of recent sales now starting to show indications of further price rises for certain size and age groups. We have already witnessed from previous weeks the increased interest on the Supramax/Ultramax range while recently there has also been increased interest and activity in the slightly older Panamax range, with a number of early 2000’s units changing hands again this week. On the tanker side, the market was almost at a standstill this week, with very little activity coming to light. This is not exactly reflective of the sort of buying interest that has been circulating the market these past couple of weeks.”
“Expectations are that we will start to see a greater number of deals emerge especially on the large Crude carriers, though as to when will depend on sellers coming to terms with the prevailing price drops that have been felt”, the shipbroker concluded.
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Source: Info-europa
