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Dry Bulk Ordering Activity Takes a Breather

Newbuilding orders for dry bulk carriers has taken a breather during the course of the past week, as owners are scaling back their investment programme, on the back of renewed uncertainty, due to the raging pandemic. In its latest weekly report, shipbroker Allied Shipbroking said that “a pause was noted in dry bulk ordering this past week, with no new transactions coming into the light. It seems that the recent downward route noted in the freight market has affected buying appetite. It is likely that we will continue to see minimal activity for the remainder of the year, with any renewed decisions about fleet expansions shifted over to 2021. However, the pricing factor will continue to play a key role for buyers and thus this could ultimately change in the case that we encounter any major drop of newbuilding prices. At the same time, newbuilding ordering on the tankers’ side was once again on a positive track, a fairly surprising fact given the continued pressure noted in the freight market. Most seem to expect that we have entered the final stage of this most recent descending pattern in freight rates, while long term fundamentals are still encouraging. This past week, we witnessed 2 VLCCs and 3 MRs being ordered from European and Chinese interests. Finally, it is worth mentioning that it was an impressive week for the containership segment as well, with 17 units being added to the orderbook, helped by the positive trends that have been witnessed of late in their freight market levels”.

In a separate note, shipbroker Banchero Costa said that “activity was dominated by ultra large container carriers 23,000 TEUs orders made by OOCL: the total number of newbuilding orders reached 12 since the beginning of 2020. Prices were between $155.7- $157 mln (respectively for 1st order of 5 pieces and the 2nd one of 7 pieces): deliveries are set between 2021-2024 from NACKS and DACKS (equally shared). Activity in the gas sector was very busy too both for LPG and for LNG: Knut Knutsen ordered 2 x 174,000 cbm LNG carriers at Hyundai HI at $190 mln apiece; units will go on long T/C to Poland based charterers. Petredec went for 3 + 3 93,000 cbm LPG units with Jiangnan Shipyard: delivery to be end 2023 and the price rumoured was at $77 mln. Not much to report in the dry bulk segment, except for the domestic order in China from Baosteel Shipping for 2 x 59,000 dwt tailor made Supramax units from Yangzijiang Shipbuilding. Price and terms are unknown as of yet. Finally in the tanker segment, Sea Pioneer Shipping of Greece ordered 2 + 2 MR2 50,000 dwt units to Dae Sun Shipbuilding: deliveries are set for 2nd half 2022”.

Meanwhile, in the S&P market, Banchero Costa added that “Olympic Hope and Olympic Harmony 182,644 dwt built in 2016 at JMU Japan were sold at $38 mln net each en bloc to Greek buyers. Aquadonna 177,000 dwt built in 2005 at Namura, Japan (ss/dd due 10/2020) was sold at $12 mln to Greek buyers. Two months ago, Sideris GS 177,000 dwt built in 2006 at SWS was done at $11.8 mln (SS/DD due end 2021). After inviting offers on Wednesday, Japanese controlled Pacific Kindness 82,000 dwt built in 2011 at Tsuneishi Zhoushan (BWTS fitted) was sold at $15 mln to Greek buyers. Two months ago, Ikan Bawal 82,000 dwt built in 2012 at Sanoyas was sold at $16 mln (scrubber fitted). Furthermore, Mild Sea 81,000 dwt built in 2013 at Qingdao Beihai was sold at $14 mln. Japanese controlled Bright Phoenix 56,000 dwt built in 2011 at Mitsui (SS/DD due 03/2021 & BWTS fitted) was sold for a price in excess of $11 mln to Eco Carriers of Greece and V Petrel 52,000 dwt built in 2004 at Oshima (BWTS fitted) at $6.3 mln. Two weeks ago, Orient Grace 58,000 dwt built in 2012 at Kawasaki was sold at $12.5 mln to Greek buyers. Thetis 28,000 dwt built in 2004 at Imabari (SS due 07/2024 DD due 10/2022 & log fitted) was sold at $4.9 mln to Vietnamese buyers. Stellar Hudson 23,000 dwt built in 2011 at Kurinoura Japan (SS/DD/BWTS 04/2021) was sold at $6.8 mln to ADNOC. The modern VLCC TRF Horten 320,000 dwt built in 2018 at Hanjin (Subic Bay) was sold at $72 mln to Greeks. In the Aframax segment: Bergina 105,000 dwt unit built in 2007 at Tsuneishi Tadotsu (SS/DD/BWTS 08/2022) was sold to Vietnamese buyers at $17.2 mln. Two weeks ago, Ocean Trader 108,000 dwt built in 2008 at SWS was done at $15.8 mln. In addition, Delos Voyager 106,000 dwt built in 2003 at Namura was sold at $12.5 mln”, the shipbroker said.

Allied added that “on the dry bulk side, the vivid interest remained for yet another week, with several new transactions reported. The strong appetite was once again spread across all different size segments, depicting the positive stance by buyers for the overall outlook of the market. Despite the recent drop in freight earnings, buyers are still keen on adding new units in their fleet, aiming to enhance their exposure on the sector, hoping to a further improvement in demand in 2021. On the tankers side, interest also remained intense this past week, even if numbers were not as impressive as in the dry bulk market. Given the resuming downward pressure noted in the freight market, it is interesting that we see investors still betting on this sector. The belief that sooner or later we will reach the bottoming out of the market has increased interest amongst buyers which are now waiting to see if these expectations will come true”, the shipbroker concluded.

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