Shipowners Hunt for Newbuilding Discounts

Shipowners are actively looking for more bargains in the newbuilding markets ahead of the summer lull. In its latest weekly report, shipbroker Allied Shipbroking noted that “activity has continued to hold at a fairly good pace these past weeks, with a lot of interest seemingly centered around the ability to secure any discounted slots for older vessel designs. With the main driver being the pricing aspect, it is difficult to see how this positive trend in buying interest could continue for much longer. Prices being quoted by shipbuilders are likely to see significant further hikes over the rest of the summer period something that will surely act as a demand dampener in the short run. At the same time we continue to see leasing deals coming through by the big leasing houses in China, something that has surely also played it part and will likely be a determining factor moving forward, especially when you take into consideration the difficult conditions in terms of financing being faced in the secondhand market.

Meanwhile, in a separate newbuilding report, Clarkson Platou Hellas said that there were “only a couple of fresh newbuilding orders to report this week. In tankers BW have now finalised an order for six firm plus two option coated 115,000dwt LR2 tankers at Daehan, with delivery of the firm vessels understood to be in 2020. It also came to light this week that Kyoei Tanker ordered a single 310,000dwt VLCC at JMU, with delivery in the third quarter of 2019. This takes the owners total VLCC orderbook to four units, three of which are at JMU and a singleton at Namura”, the shipbroker noted.

Meanwhile, in the S&P market, Allied said that “on the dry bulk side, activity hit a further slowdown in pace, with only a handful of units changing hands this past week. Both buyers and sellers seemed to have taken a momentary “step back” from the market, looking to get a sense of where the overall market direction stands right now both in the secondhand market as well as in the freight market. We are likely to see a fairly slow month, while there might be a slight “wake up” mid August if previous years are anything to go by. On the tanker side, a very uninteresting week here too, with only a couple of small product tankers being reported, while buying inquiries seemed to have gone quiet. There are still some who are willing to shop around in the larger crude oil size segments, however, given the fact that we are not in any rapidly firming freight market, most seem to be taking their time, looking to pick out any opportunities that now emerge”.

In a separate note, ship valuations expert VesselsValue said that “tanker values have remained stable this week. No VLCC transactions occurred this week. The Aframax Amba Bhavanee (107,100 DWT, Koyo Dock, Apr 2002) sold at auction for USD 5.6 mil with her class expired and having been idle for 5 years. The MR1 Torea (40,000 DWT, SLS, Jun 2004) sold for USD 10.8 mil vs VV USD 10.9 mil, keeping values stable”.

In the dry bulk market, VV added that “most values remained stable this week, however Supramax values saw a small softening. The Cape Frontier (180,200 DWT, Koyo Dock, May 2006) sold for USD 17.9 mil vs VV USD 18.6 mil softening mid aged Capesize values. The Panamax BC Aesara (75,300 DWT, Hyundai Samho HI, Sept 2001) sold for USD 7.5 mil vs VV 7.4 mil mildly firming Panamax values for ships of this age. The Panamaxes BBC Glory & Hope (82,100/82,000 DWT, Qingdao Beihai Shipbuilding HI Co Ltd, Apr/Aug 2013) sold en bloc for USD 30 million” it concluded.