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Weekly Broker: Keep an eye on asset values

The dry bulk vessel sale and purchase market has seen another week of subdued activities. Investors still lack confidence despite discounts on offer and some signs that the market is picking up – cape rates rallying by nearly 25% yesterday.

According to Allied Shipbroking’s Indicative Dry Bulk Values, discounts are offered in almost all size groups, especially for vintage units. The average price for 15-year-old 150,000 dwt capesize bulkers and 15-year-old 52,000 dwt supramax bulkers have dropped by 14.3% and 17.6% respectively in the past month.

“Shipowners should keep a close eye on asset values now and before the market takes off. Volatile times are not for the faint hearted but the reality is that that it is more conservative to invest during a bottoming market instead of buying a vessel when prices have already appreciated, not only because tonnage is priced more realistically but also because the downside in the first instance is much smaller,” said Timos Papadimitriou, an S&P broker with Intermodal.

“On the dry bulk side, a relatively modest flow of transactions took place last week, with the overall SnP market having been for a prolonged period in the doldrums. At this point, we witness a preference for medium to smaller size segments, as well as, for more vintage units, with buyers seemingly being rather hesitant to hugely invest in this sector at these prices right now. Moreover, given the poor path in terms of freight returns since the beginning of the year, we don’t expect any major shift to develop any time soon,” Allied Shipbroking said in its latest weekly report.

Allied Shipbroking, Advanced Shipping & Trading and Seasure Shipbroking all listed a deal in which South Korean owner Kamco sold its 1997-built 69,100 dwt panamax bulker Meister to Chinese buyers for $3.3m.

Allied Shipbroking, Advanced Shipping & Trading, Intermodal and Lorentzen & Stemoco all reported the sale of the 2010-built 28,000 dwt handy bulker Wave Friend. Japanese owner Daisan Kaiun sold the Imabari-built vessel to Greek buyers for $6.3m.

“On the tankers side, another strong week was due for the SnP market, indicating once again the firm buying appetite surrounding this specific sector. With all major size segments showing a rather bullish face in terms of activity noted, we may well expect a relatively active and robust market to hold. Notwithstanding this, it is yet to be seen if we will start to witness a robust flow of sales for more modern units as well,” Allied Shipbroking noted.

Splash already reported this week that US owner Ridgebury Tankers sold two vintage VLCCs –Ridgebury Progress and Ridgebury Purpose – en bloc to a Chinese refiner for storage purposes for $48m in total.

Allied Shipbroking, Clarksons and Lorentzen & Stemoco all reported the sale of the 1999-built 105,000 dwt aframax tanker Torm Kristina. Danish owner Torm sold the South Korean-built vessel to Middle Eastern buyers for $10m.

Advanced Shipping & Trading, Intermodal and Lion Shipbrokers all reported that Russian owner Sovcomflot sold two 2003-built 47,900 dwt MR tankers Hermitage Bridge and Anichkov Bridge. The vessels are believed to have been acquired by Greek buyers for $9.5m each.

In the secondhand containership sale and purchase market, according to Braemar ACM Shipbroking, whilst there are no reportable secondhand transactions this week, negotiations continued on a number of vessels and several bank-forced sale candidates are set to invite offers in the coming days.

Jason Jiang

Jason is one of the most prolific writers on the diverse China shipping & logistics industry and his access to the major maritime players with business in China has proved an invaluable source of exclusives. Having been working at Asia Shipping Media since inception, Jason is the chief correspondent of Splash and associate editor of Maritime CEO magazine. Previously he had written for a host of titles including Supply Chain Asia, Cargo Facts and Air Cargo Week.
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