In Hellenic Shipping News 19/02/2015
Newbuilding activity is still on “slow motion mode”, as shipbrokers are reporting limited activity. According to the latest weekly report from Allied Shipbroking, it was ” a very slow week, with minimal reported activity in terms of conclud-ed new orders. Tankers are still in the spot light taking up more capacity as potential buyers hold a more optimistic view thanks to their bullish freight rates. There have even been further swapping of dry bulk orders over to tanker orders, as owners try to take advantage of the lower prices currently on offer, while also attempting to minimize their exposure to the poorly performing dry bulk market”.
The shipbroker added that “as things stand now competition has started to mount, while problems will like-ly continue to be seen during at least the majority of the year. The squeeze on financing is likely to add to this issue, as the limiting of cash support to add further owners will limit newbuilding activity to the large players and those few which still have cash support. Even these may well be enough to pile on a significant amount of orders, however the hope is that with such discounts being offered for secondhand tonnage, buying interest will focus there for the moment causing few to take the newbuilding route”, Allied concluded.
Meanwhile, according to the latest weekly report from Clarkson Hellas, “in Tankers, Sinokor Merchant Marine are reported to have converted an order for four 180,000 DWT Capesize bulkers at Daehan Shipbuilding in Korea to 114,000 DWT LRII Product Tankers and to have placed a further order for two firm plus four optional 114,000 DWT LRII Product Tankers at the same yard. These vessels are scheduled to deliver throughout 2016 and 2017. China Shipping Development Co have announced an order for four firm 308,000 DWT VLCC at Dalian Shipbuilding Industry Co for delivery in 2Q and 3Q 2017 and 2Q and 3Q 2018″.
The shipbroker added that “in Dry, although the original contracts were signed last year, it came to light this week that Tsuneishi Zhoushan have taken an order from Clients of Efshipping for firm two 82,000 DWT Kamsarmax bulkers for delivery in 1H 2017. H. Vogemann are reported to have declared an option to build two 38,000 DWT Handysize bulkers at AVIC Weihai in China. These will be the 5th and 6th unit in the series and deliver in 1H 2017″, Clarkson Hellas concluded.
Intermodal’s latest weekly report also noted that “newbuilding activity slightly eased during the past week, while as expected, tanker orders still made up for the big majority of deals that were reported. At the same time, newbuilding prices over at the dry bulker side still appear weak, with further downward corrections taking place on the back of almost non-existent ordering interest. We mentioned last week that the conversion of dry bulk orders into tanker ones is slowly forming into a trend. The flipping of an older Capesize order by Sinokor to an LR2 one, which came to light very recently, is also evident of that trend, which could well last throughout the first half of the year. So before dry bulk ordering activity picks up again, we believe that cancelling or flipping of newbuilding orders together with intense scrapping activity is on the way, as both these should allow the market to find some sort of balance and consequently make owners reconsider the newbuilding prospect. In terms of recently reported deals, S. Korean owner, Sinokor, has also placed an order, for two firm and two optional LR2 114,000dwt) at Daehan, in S. Korea, for a price of $55.0m each and delivery set between 2016 and 2017″.
Meanwhile, Allied Shipbroking noted on the demolition market this week that “significant drops are still being noted on offered prices coming out of the Indian Sub-Continent, while things are expected to be under pres-sure for some time. Despite this significant drop, activity has held at fairly high levels, with several owners pushing to sell off some of their overage units before the market losses further ground. This excess in available demo candidates has been one of the reasons that prices have been under so much pressure, but looking deeper into the issues here the main things at play have been the loss in support from the prevailing oversupplied steel market, while the excess buying of some cash buyers at high levels have pushed them to try and make up some of their losses now that completion amongst breakers is minimal. The large uncertainty and lack of clear direction has pushed some break-ers to stay in the sidelines rather than make any move they might re-gret down the line”.
