Diana Shipping announced on Friday another period deal for one of its bulkers at far higher levels than the same ship achieved under its previous employment.
Bocimar International has fixed the 82,100-dwt karmsarmax Myrsini (built 2010) for about six months at $27,750 per day, the US-listed company said in a stock exchange filing.
This compares with the $11,500 per day that the Myrsini attained under a charter with Ausca agreed in December 2019.
"Given that the FFA [forward freight agreement] five-month implied value for such a vessel is between $26,000 and $26,500 daily and this week's BPI 82 5TC closing was very close to these levels, charterers had to pay a premium to entice owners to wrap this short-period deal up," research analysts at Athens-based Doric Shipbrokers wrote in an email.
The Myrsini deal rounds up a week "full of activity" for chartering desks specialising in period fixtures, Doric said.
Until late Friday, European time charterers were bidding for eco-bulkers with delivery in the Far East at between $27,000 and $28,000 per day, according to Doric's analysts.
"Colossal" stimulus measures taken across the world are keeping sentiment buoyant as dry bulk shipping enters its seasonally strongest period of the year in the late second and third quarters, they added.
Companies such as Diana Shipping are benefiting from this trend.
The company has clinched period deals for five of its vessels over the past two months — two newcastlemaxes, one capesize, one post-panamax and the Myrsini.
The freight rates the company achieved in these deals were more than 70% higher, on average, than each of the vessels' most recent charters, according to TradeWinds calculations.
Late last month, Classic Maritime fixed the 206,000-dwt Philadelphia (built 2012) from Diana or about a year at $28,500 per day — the highest rate Diana has achieved for the ship.
The five chartering deals combined will boost Diana’s gross revenue by nearly $33m over the lifetime of the charters, which extend between six months and one year.
Longer periods to come?
With higher freight rates becoming increasingly entrenched, analysts and investors will start shifting their attention to whether bulker companies will manage to lock in such elevated earnings for even longer periods.
Some two-year fixtures have already been concluded and several shipowners are optimistic their number and duration will increase in the near future.
On Thursday, Polys Hajioannou, founder and chief executive officer of Safe Bulkers — a competitor of Diana Shipping — said fixtures of more than three years could come in the third quarter.
Conditions for such long deals will ripen when the price of FFAs for 2022 increases, Hajioannou added.
FFAs are currently in backwardation, partly due to concerns over India's health crisis. Looking forward, however, "market sentiment remains robust, with fitter fundamentals supporting a quite positive scenario for the months to come", Doric said.
