Hard to comprehend, the continuing desire to convert aging single-skin VLCCs to dry bulk carriers still continues, albeit at a slower pace, but neverless still a feature of current markets, with South Korea operator Polaris Shipping reportedly having just purchased four single-hull tankers for transformation into bulkers. In China the Cosco Shipyard also announced it has completed the first conversion contract in the recent wave. The Hosco-owned Hebei Success is reported to have come in at budget, at $25m, while work took seven months, somewhat higher than the three-to-six months suggested by many commentators when the trend for conversion projects first emerged (reports broker Barry Rogliano).

Players looking at future conversions will have to weigh up future iron ore prospects, with Chinese authorities already predicting a fall in steel production growth from 16% in 2007, to between 6%-10% this year.

The Baltic Panamax Index went up by 522 points last week, finishing at 8,601. The Panamax four time charter average gained US$4,200, inching up to US$70,000. Strong activity in the Atlantic, where plenty of fresh requirements hit the market, prompted rates to jump from the low US$70,000s to the high US$70,000s. In the Pacific, the activity was
mainly driven by the NOPAC round via Australia and coal from Indonesia to China.

Handies and Supras started moving in the Atlantic on the back of intense trading from South America. Handymaxes for transatlantic round voyage ended the week in the low/mid US$50,000s. Smaller sized units managed to get in the low
US$30,000s for similar trade. By contrast, the situation in the east is far from bright. There is some business around but available spot/prompt tonnage is still plentiful.

Source: Barry Rogliano Salles, shipbrokers, Paris
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