Weekly Broker: Every concluded secondhand boxship sale will set a new low

The dry bulk sale and purchase market has finally seen a fair amount of concluded deals following weeks of subdued activities. More buyers are going back to the dry bulk sector as further discounts have been offered while the Baltic Dry Index has picked itself off the floor this week.

Allied Shipbroking’s Indicative Dry Bulk Values shows discounts are mainly on offer in the smaller size segments. The average price of 10-year-old 56,000 dwt supramax and 15-year-old 52,000 dwt supramax has dropped by 8% and 11.8% to $11.5m and $8.5m respectively since April 10.

“On the dry bulk side, a modest level of activity was seen for yet another week. The recent severe drop in freight rates though is expected to hurt market sentiment further and lead to decreased appetite from the side of buyers. However, last week we noted several new deals being reported, with focus given once again to the smaller size segments such as supramaxes and handysizes. This trend is not expected to change anytime soon, as buyers are looking for the security provided by the lower risk/lower volatile market segments,” Allied Shipbroking said.

One sale coming to light in VesselsValue sales register has been done by Densay Shipping of Turkey who has made a move for the seven-year-old 37,100-dwt SSI Marvelous, a ship sold iby Japanese owner Daido Shipping. The move is Densay’s first purchase since last year when it also picked up a ship in the same segment. This deal brings Densay’s fleet up to 17 bulkers.

Multiple shipbroking houses reported Swiss owner SAM sold its 2010-South Korean-built 33,400 dwt handy bulker Sam Panther while Allied Shipbroking identified UK owner Carisbrooke Shipping acquiring the vessel for $6.9m.

Allied Shipbroking, Advanced Shipping & Trading, Intermodal all reported that Greek owner Blue Planet Shipping has acquired two resale 63,500 dwt ultramax bulk carriers Hull 096 and Hull 1505 from the yard from Chinese yard Nantong Xiangyu for a price of $22.25m each. VesselsValue data shows Hull 096 was originally ordered by HTM Shipping while Hull 1505 was ordered by Greek owner Masters Ships Management. Both vessels are set to be delivered this year.

“On the tankers side, things may be much more positive with regards to the current market outlook, but this has yet to be properly reflected in the volume being noted in the second hand market. Last week was no exception to this with a still slow flow of new deals coming to light. The bullish appetite is still dominating the segment though and thus it is likely that we will see further activity emerge over the coming weeks,” Allied Shipbroking said.

Lorentzen & Stemoco and Advanced Shipping & Trading both listed the sale of the 2003-built 46,000 dwt MR tanker Port Union. US investment firm Apollo Fund sold the vessel to undisclosed buyers for a price of $5m.

In the containership sale and purchase market, asset prices continue to come under pressure.

According to Braemar ACM Shipbroking, Columbia Shipmanagement sold its 2009-built 1,740 teu boxship Cape Nati to German buyers at a very low price of $5m.

“With a greater variety of sales candidates coming to the market across the spectrum; from fifteen year old post-panamax to feeder resales; it is very reasonable to expect that in the short term every concluded second hand sale will set a new low. Once these benchmarks are set, we expect this to pull in more buyers whom are currently on the side lines,” Braemar said in its report.

The box situation is not helped by the huge amount of idled tonnage and the subsequent crash in charter rates.

The latest data from Alphaliner shows the inactive containership fleet has surged to a new record of 524 units equivalent to 2.65m teu as at 11 May, surpassing the previous high of 2.46m teu at the beginning of March this year. The inactive fleet currently accounts for 11.3% of the total containership fleet capacity.

“The consequences of the COVID-19 pandemic on the charter market are becoming clearly visible with capacity cuts by carriers resulting in a skyrocketing overcapacity across most vessel sizes,” Alphaliner noted in its most recent report.