Shipyards, noting the massive contraction in prices between secondhand and newbuild bulkers, are now trying to push up prices.
In recent weeks the gap between five-year-old bulkers and newbuilds has closed dramatically, whereby a secondhand cape is now commanding $32.5m, while a new one can be bought for as little as $40m.
For kamsarmaxes, the differential is even tighter – $21m secondhand and just $24m for a newbuild.
In its latest weekly report, Allied Shipbroking notes: “Despite the still limited flow being seen in terms of new orders, we have started to see some slight increases being noted in the price figures being quoted by shipbuilders. This has been more so for dry bulk vessels, likely being assisted by the sharp rise in secondhand asset prices that have been seen over the past couple of weeks… It remains to be seen if this gamble will pay off in the long run, but for know the market seems to be able to support this, while the indications of further price hikes in the secondhand market could help assist in this regard further, making the current newbuilding prices ever more competitive.”
In the first quarter there have been a smattering of bulkers ordered at yards in Asia, likely signalling the end of the bulker order drought as generational low prices tempt many.
Clarkson’s shipbuilding price index looks to have flattened in recent weeks after years of decline.
Another broker, Intermodal, reported this week that the speed in which secondhand prices have been firming is indeed impressive across all dry bulk sizes but particularly panamaxes and capes, where the average monthly price for a five-year old vessel has increased more than 19% and 20% respectively within just one month.