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Weekly Broker: Owners unfazed by dry bulk freight rate collapse

The final quarter is proving to be the busiest three-month period of the year for secondhand transactions, and the buying has not slowed despite a precipitous drop seen in the dry bulk freight market where cape earnings were sheared in half last week. All this suggests buyers have a strong gut feel for prospects for 2019. Higher discounts offered for older tankers at the moment have also made owners more willing to open their pockets for what is seen as a relatively lower risk investment.

“On the dry bulk side, a fair volume of transactions took place the past week, despite the turbulent scene noted in the freight market. With spot earnings being on a steep downward correction, especially on the capesize segment, things are rather uncertain on the SnP front, in terms of what to expect next. Notwithstanding this, given that buying appetite remain ample, we can expect the overall sentiment to return to the positive side and a fair number of deals to take shape before the closing of this year,” Allied Shipbroking said in its latest weekly report.

A number of shipbroking houses reported the sale of the 2015-built 63,000 dwt ultramax bulker Vela, while Lorentzen & Stemoco and Intermodal have identified the buyer as Greek owner Oceanbulk, which acquired the vessel from Eagle Bulk for a price of $20m.

Both Advanced Shipping & Trading and Lorentzen & Stemoco listed a resale of two 61,000 dwt ultramax newbuildings at Dalian Cosco KHI (DACKS). Idan Ofer’s Eastern Pacific Shipping has sold two vessels hull 046 and hull 044 to compatriot owner Niovis Shipping for a price of $27.5m each. Eastern Pacific is now reportedly looking to exit both the handysize and ultramax bulker segments and has listed seven ships from its fleet for sale.

According to multiple reports, the 2008 Chinese-built panamax bulker Pelagos has been sold by Greek owner Pelagos to Croatian owner Atlantska Plovidba. The vessel, renamed AP Libertas, has fetched a price of around $11.9m.

Splash understands the 17-year-old Japanese-built panamax bulker Kinko Maru has been sold by Japanese owner K Line to Chinese owner Dongguan Haichang Shipping for $11.5m. Dongguan Haichang is the shipping unit of Dongguan Haichang Industry, a bulk terminal operator in Dongguan. The company currently operates a fleet of 14 bulkers.

“On the tanker side, activity here showed a slight softer face, at least on a w-o-w basis, in contrast somehow with the overall better state of the freight market. At this point, we see buying interest is mostly concentrated on the more vintage units, given that these units offer relatively higher ‘discounts’ and subsequently positioned to a lower risk regime,” Allied Shipbroking said.

Several shipbroking houses including Intermodal, Allied Shipbroking and Seasure Shipbroking all reported the resale of two suezmax tanker newbuildings at South Korean yard Daehan. Greek owner John Angelicoussis’ Maran Tankers is said to have taken over the two 158,000 dwt newbuildings Daehan 5043 and Daehan 5044 from Norwegian owner Faerder Shipping for a price of $61.5m each. Delivery of the two vessels is scheduled in 2020.

Mutiple shipbroking houses all listed the sale of the 2003-built 151,000 dwt suezmax tanker European Spirit. The vessel was sold by Teekay to Greek owner Transmed for a price of $15.7m.

Another deal reported by many shipbroking houses is the sale of the 2011-built 156,000 dwt suezmax tanker Shamrock. Danish owner Navigare is said to have acquired the South Korean-built vessel from US investment group Icon Capital. The vessel has fetched a price of $31m.

In the secondhand containership sale and purchase market, Braemar ACM Shipbroking reported that the 2003 Japanese-built 6,266 teu NYK Artemis has sold been sold by NYK to Cyprus Sea Lines for a price in the region of $13m. The vessel is destined for charter to MSC.

In the feeder sector, German owner Vega Reederei has been reported as the buyer of two 2005-built 1,118 teu boxships, the E.R. Hobart and E.R. Sydney. The price for each vessel is $4m, which has set a new benchmark low for the sector.

“Demolition remains firm, with buyers still hungry to get their hands on any container vessels coming workable for sale. There are numerous vessels being negotiated for recycling and we expect more sales to emerge in the coming days, at levels similar to last done,” Braemar said in its weekly report.

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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