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Weekly Broker: The bottom of the market

The ongoing doldrums in both the dry bulk and tanker market has failed to curb the appetite of buyers in the S&P market this past week with a fair amount of deals concluded. However, a slowdown in concluded deals was seen compared with volumes in prior weeks, especially in the larger size segments. With further discounts offered in dry bulker S&P prices, it is expected that bargain hunters are ready to snap up more cheap tonnage.

After a dire month, the fortunes for dry bulk owners appear to have turned this week with the Baltic Dry Index inching up for consecutive days and Fearnleys calling the bottom of the dire cape market. The time to catch the metaphorical falling knife would appear to be nigh.

“On the dry bulk side, there was a slowdown noted in activity, with the market caught up by the poor freight markets. However, there were still transactions noted last week with focus being given to kamsarmax and supramax units. The slightly better outlook and earnings noted in these two segments possibly make the investment choice here more attractive. Meanwhile, with prices in a sliding mode, it is expected that we will see revived interest soon, as bargain hunters will be in search of any and all opportunities to be seen,” Allied Shipbroking said.

Mutiple shipbroking houses reported that Japan’s Mitsubishi Corporation sold its 2013-built 58,000 dwt supramax bulker Cygnus Ocean while Allied Shipbroking identified the buyer of the Chinese-built vessel as US owner Phoenix Bulk Carriers. The vessel has fetched a price of $13.25m.

Allied Shipbroking, Banchero Costa and Lorentzen & Stemoco all reported the sale of the 2015-built 37,000 dwt handy bulker Ultra Tolhuaca. The Japanese-built vessel was sold by Ultrabulk to Japanese buyers for $17m.

More than five shipbroking houses reported that South Korean owner Doriko sold the 2010 Chinese-built 32,700 dwt handy bulker Gloria Galaxy. The vessel has been acquired by Vietnamese buyers for $6m.

“On the tankers side, the slowdown momentum was resumed this past week, with declining freight markets affecting buyers’ appetite. Last week, the most interesting deal included the resale of three VLCC units, while the product tanker segment was once again dominated buyers’ interest. Prices here have not yet posted any drop and in contrast have shown some slight uptick, as market participants remain optimistic even after the correction noted in freight rate levels,” Allied Shipbroking said.

Allied Shipbroking, Intermodal, Anchor Shipbroking and Lorentzen & Stemoco all reported a deal in which Japanese owner Nisshin Shipping sold its 2009-built handy tanker Bow Hector to Norwegian buyers for $19m.

A number of shipbroking houses including Clarksons, Allied Shipbroking, Intermodal and Lorentzen & Stemoco all reported that Indian owner Global Tankers acquired the 2012-built 16,000 dwt handy tanker Nu Shi Nalini from Elektrans Shipping through an auction for $1.9m. Daniel Chopra’s Elektrans Shipping was declared insolvent in April last year.

Following a pickup in activities in the past couple of weeks, the secondhand containership sale and purchase market has gone quiet this week with few deals reported.

“Although various news reports coming from China are suggesting that the rate of spread of the Coronavirus is abating, a number of market players are now sitting firmly on the fence monitoring the situation before moving on vessels,” Braemar ACM Shipbroking said in its latest weekly report.

Clarkons and Optima reported that Chinese boxship operator Shanghai Hai Hua Shipping sold the 2006-built 1,118 teu Glory Fortune to undisclosed clients for $3.6m.

Lorentzen & Stemoco and Seasure Shipbroking reported that Contships offloaded the 1997-built 977 teu BFP Galaxay for $2.1m.

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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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