Secondhand buyers hold back as freight rates fall
ACTIVITY in the sale and purchase market slowed last week, as buyers held back from deals after watching freight rates in the dry bulk and tanker sectors fall, writes Liz McCarthy .
“Declining freight rates, financial constraints and the prospect of further falls in asset values seem to be making buyers nervous,” said London broker Gibson in its weekly report.
“The market is rife with rumours of a number of high-profile deals falling through.”
The sale of the 69,255 dwt, 1993-built Energy was understood to have failed, according to London broker ICAP Shipping.
The panamax dry bulk carrier had been reported sold to Chinese buyers for over $15m two weeks ago, by Italian owner Cafiero Mattioli Group.
In contrast to activity in the last two months, very few sales were concluded last week. Brokers said deals that were finalised were not of great significance either.
Chinese buyers took the 61,748 dwt, 1984-built Armonikos from Piraeus-based Mayamar Marine Enterprises for $4.5m, according to Gibson.
The broker also reported three sales in the handysize sector, including Japan’s MK Shipmanagement Co selling the 32,355 dwt 2004-built Angel Arrow for $20m to South African interests. ICAP Shipping reported the buyer was Dockendale Shipping Co.
The 30,396 dwt, 1982-built Win was sold to undisclosed interests for $2.8m by Greek operator Trade Fortune.
Vietnamese buyers bought the 22,560 dwt, 1981-built Anax for more than $1.8m from its registered owner, Malta-based Anax Shipping Co.
ICAP Shipping reported that among the overaged tonnage sold last week, the 29,105 dwt, 1985-built Notori Dake was understood to have been sold for $4m by Hong Kong’s Wallem Shipmanagement.
India’s Great Eastern Shipping is also understood to be marketing its 45,342 dwt, 1997-built Jag Ravi for sale, after selling another handymax bulker two weeks ago.
The number of sales concluded in the secondhand tanker sector was even smaller, as negative sentiment spread further across the clean and dirty markets. Spot freight rates are barely covering operating costs and no improvement is expected soon.
“This has had a dampening effect on the sale and purchase market and as each week passes, fewer and fewer sales are reported,” said Gibson.
The London broker said there were no significant sales to report, but that offers were expected this week on the single-hull, Vela International-owned 305,668 dwt, 1994-built Carina Star , which could set a new benchmark value for older very large crude carriers. By comparison, its sistership, the Orion Star , was sold in August last year for $47.5m.
Other tanker sales included the 16,322 dwt, 1997-built combined tanker Golden Elizabeth to undisclosed buyers for $11m by Japan’s Yamato Kisen.
Indonesian buyers purchased the 7,334 dwt, 1984-built Vijay Doot for $2.5m from Mumbai-based Varun Shipping.
• This article is compiled on the basis of publicly available sources. Reported transactions may not have been confirmed with the buyers or sellers named. Accordingly, Lloyd’s List cannot guarantee the accuracy of the information.