Ship Market: Declining Asset Values and Tanker Sales

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Mfame Editor
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  • Recycling markets face weak demand, dry bulk drops.
  • S&P sales report notable bulkers and tankers deals.
  • Newbuilding orders continue for methanol-ready vessels.

The Ultramax SAGAR KANTA (60,835 dwt, built 2013 Iwagi, Japan) was sold to Indonesian purchasers at US$19 million, after OMISHIMA ISLAND (61,398 dwt, built 2013 Iwagi, Japan) was sold for US$19.5 million. Both ships, with close docking positions, are indicative of the current softening of Ultramax values. A spate of new Ultramax deliveries, including 25 in January alone, is exerting downward pressure on both freight rates and asset values. Although prices remain higher than the 2019-20 lows, they have been on a steady decline since late last year, raising questions about how much further they may fall, reports Gibson.

Broader Decline Across Segments

The downward trend is not limited to Ultramaxes. The Post Panamax “ALCMENE” (93,193 dwt, built 2010 Jiangsu Newyangzi, China) was sold for US$11.9 million, down from the previous sale of “PISCES FIRST” (93,238 dwt, built 2010 Jiangsu Newyangzi, China) at US$12.9 million. This is reflective of a general decline in asset prices, particularly because of lackluster prospects for the dry bulk market. The only things that can turn this around are economic tailwinds or geopolitical positives.

Tanker Market Activity

VLCCs: There were several offers for the Taiwanese VLCC “FPMC C INTELLIGENCE” (301,861 dwt, 2010 IHI, Japan), with bids at about US$48 million, in line with the recent sale of the “WAFRAH” (317,788 dwt, 2007 Hyundai Samho, S. Korea) for US$40-41 million. Owners are holding out for US$50 million, and they have to decide whether to lower their expectations or keep the vessel.

Modern LR2 Tankers: NS Lemos allegedly earned a handsome profit on two new LR2s, “KAVAFIS” and “ELYTIS” (113,840 dwt, built 2023 + 2024 SWS, China), selling the pair for US$143 million to other Greeks. The deal brought more than US$20 million in profit for the owners.

MR Tankers: The MR1 market is still very illiquid, with limited benchmark transactions. Yet the “SUNNY STAR” (37,857 dwt, built 2010 Hyundai Mipo, S. Korea) was traded at US$17-17.5 million, a marked decline from its potential nine months ago. Also, the sister ship “EASTERLY CANYON” (34,998 dwt, built 2009 Hyundai Mipo, S. Korea) was traded at US$16 million.

Recycling Market Under Pressure

The recycling industry is under huge pressure, with the added pressure of US trade tariffs on steel demand. Local Alang steel markets have also further declined, with weak demand. The depreciation of the Rupee to INR 88 is a cause for concern for the market. In the same way, Bangladesh’s economic crisis has added to the pressure on ship-breaking operations. Even so, some breakers are still inclined to buy ships, but the sentiment is overall bearish. Dry bulk ship prices have fallen below US$450 per LDT, and there could be more talks between the US and Russia affecting older vessels on their way to the scrapyards.

Ship Sales and Purchases

Bulkers

  1. NSU INSPIRE (250,813 dwt, built 2011, Namura, Japan) sold to Berge Bulk for US$37 million, equipped with a scrubber.
  2. ALCMENE (93,193 dwt, built 2010, Jiangsu Newyangzi, China) sold to a Greek buyer for US$11.9 million with SS due in December 2024 and BWTS.
  3. SAGAR KANTA (60,835 dwt, built 2013, Oshima, Japan) sold to Indonesian buyers for US$19 million with DD due in June 2026 and BWTS.
  4. RIVER GLOBE (53,627 dwt, built 2007, Yangzhou Dayang, China) sold for US$8.5 million with DD due in August 2025.
  5. NORD NANAMI (38,204 dwt, built 2012, Imabari, Japan) sold for US$13.5 million with SS and DD due in June 2025 and BWTS.
  6. LIBERTY C (32,618 dwt, built 2012, Jiangsu Zhenjiang, China) sold for US$9.2 million with DD due in November 2025.

Tankers

  1. LOGGAM (299,996 dwt, built 2003, Samsung, Korea) sold for US$31 million, with DD due in April 2026.
  2. KAVAFIS + ELYTIS (113,840 dwt, built 2023 + 2024, SWS, China) sold for US$143 million en bloc to Centrofin.
  3. FREE SPIRIT (113,091 dwt, built 2008, New Times, China) sold for US$36 million with DD due in August 2025.
  4. PS AUGUSTA (49,999 dwt, built 2011, STX Jinhae, Korea) sold for US$25.6 million to a Middle Eastern buyer, with SS due in March 2026 and BWTS.
  5. SUNNY STAR (37,857 dwt, built 2010, Hyundai Mipo, Korea) sold for US$17-17.5 million to Chemnav, with SS due in May 2025 and BWTS.
  6. EASTERLY CANYON (34,998 dwt, built 2009, Hyundai Mipo, Korea) sold for US$16 million to a Greek buyer, with SS due in July 2027 and BWTS.

Containers / Ro-Ro / Reefer / PCC/PCTC

  1. NORDLION (23,574 dwt, built 2014, Zhejiang Ouhua, China) sold for US$24 million to a Middle Eastern buyer.
  2. EVI (17,350 dwt, built 2008, Jiangsu Yangzijiang, China) sold for US$12.7 million to an undisclosed buyer.

Newbuilding Orders

  1. COSCO Shipping Energy Transportation ordered two Aframaxes (114,200 dwt) at COSCO Yangzhou, China, for US$86 million.
  2. COSCO Shipping Energy Transportation ordered two LR2s (190,900 dwt) at COSCO Yangzhou, China, for US$89 million.
  3. COSCO Shipping Energy Transportation ordered two LR1s (74,000 dwt) at COSCO Dalian, China, for US$64 million.
  4. Evergreen ordered six 24,000 TEU container ships at Hanwha Ocean, Korea, for US$265-295 million.
  5. Danaos Corp ordered two 9,200 TEU containerships at Huangpu Wenchong, China, for US$105 million.

Recycling Market Values

Recycling prices in Bangladesh, India, Pakistan, and Turkey are as follows:

  1. Tankers / Cont / Ro-Ro / Capes / PCC / LPG / LNG: US$465-480 (Bangladesh), US$460-475 (India/Pakistan), US$310-320 (Turkey).
  2. Bulkers / Tween / General Cargo: US$445-455 (Bangladesh), US$440-450 (India/Pakistan), US$290-300 (Turkey).

This overview highlights the trends in ship sales, tanker market activities, newbuilding orders, and the ongoing challenges in the recycling market.

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Source: Gibson