Market fundementals promote rate gains
As freight rates are still improving, rumours and discussion are multiplying about long term time charter deals, but further to this seasonal movement another question has arisen: is it the right time to order new ships?
Successively two major players have decided to ink new Capesize tonnage despite the very high prices (just above US$60m) and the late delivery dates offered by the shipyards (second half 2009). This year will see the delivery of a massive volume of new dry bulk carriers, but if we look further into 2008 and 2009 the situation looks more balanced and leaves some room for newbuildings. So far the new ships have been fairly well absorbed by the market and the expected revival of demolition could also ease the pressure of this newbuilding wave.
From the outset of last week, the Panamax market continued to strengthen with a number of short and longer term period fixtures being reported. A new 77,000 dwt type with delivery Japan in August was reported as fixed at US $16,000 per day for a three year period, and there were a number of modern types fixed for short periods with delivery in the East at around US $21,000 per day, indicating a more confident tone from the Panamax players.
However, the market lost some steam towards the end of the week with charterers seeking to step away from the heat, the BPI eventually closed on Friday up by just 16 points at 2,676. The Pacific market has been firm again, with several Supermax reported fixed in the region of US$24,000 per day for short period. Although the monsoon is affecting the West Coast of India, the East Coast is still not being restricted for the time being.
Modern Handysize 28/32,000dwt are obtaining about US $16,500 daily for such short periods, although these fixtures are mainly private and not reported. The Atlantic is also steady with a good activity for scrap, fertilisers, aluminium and grain mainly in 25/42,000 dwt. However, differentials are still in favour of the Pacific with, for instance, a Supermax built ‘02 reported fixed from US Gulf/Far East at about US$21,000 daily. Not so many rates reported this week for longer periods, except a 47,000 dwt modern grabber ex-Continent for 12 months at US$18,500.
Published under Cement News
