Aframax Values Hover Near Historical Highs

Credit: world wide market reports

In recent weeks there has been a slight correction in values based on the latest benchmark sales. However, year on year values for this sector are up across all age categories, for example 15YO vessels of 110,000 DWT are up by c.20.95% from USD 31.88 mil to USD 38.46 mil as values hover close to the record highs of September 2008,reports rush shipping.

Notable sales include the Aframaxes Anavatos 2 and Fulmar (115,00 DWT, Jan 2009, Hanjin HI) sold to Unknown Middle Eastern buyers for USD 79 mil en bloc, VV Value USD 86.17 mil. This time last year, the same vessels were valued at USD 70.52 mil.

Greek owners have been behind a high proportion of the sales, offloading 37 vessels so far this year or c. 35.6%. The United Arab Emirates are currently in second place with c. 15%, Canada and China rank joint third with c. 8.4%.

Newbuildings increased

Overall sentiment for this sector remains positive and Aframax newbuildings have increased by c. 191.7% YoY with 70 new contracts reported in this sector so far this year. The fact that there have been no demolition sales reported this year highlights the continued strong demand for this sector, and as values remain high, there are plenty of prospects for secondhand sales of older vessels at an age where such vessels would previously have been scrap candidates at current earnings levels.

Spot market

Although the spot market has seen some volatility, the time charter market remains firm and one year time charter rates for Aframaxes are currently up by c. 44.9% year on year to around USD 41,770 USD/Day as Aframax earnings continue to outperforming the larger Suezmax sector.

Did you subscribe to our daily newsletter?

It’s Free! Click here to Subscribe

Source : Cyprus shipping