Lists of dry bulk sale-and-purchase deals were as long as one’s arm in broker reports last year.
They have got much shorter lately, however, following a freight rate dive that slowed deal flow significantly.
Secondhand ship transactions have largely come to a halt in capesizes, the segment hardest hit by declining earnings.
“Prudent participants are left wondering how anyone can currently justify paying high secondhand prices in a softened and somewhat sensitive freight market,” Doric Shipbrokers, an Athens-based analysis and broking outfit, said on 21 January.
Dampened buying interest has been concentrating on smaller sizes, where earnings have dropped as well but remain comfortably above their levels at the same time last year.
The Baltic Supramax Index dropped by 21% between the start of the year and 21 January. However, it remains 54% above its level at the same time in 2021. The Baltic Capesize Index, by contrast, dropped by an annual 71% clip over the same period.
“With the Chinese New Year less than two weeks from now and the Winter Olympics following, one could say that shipowners are temporising ... until the market shows its real potential,” analysts at Athens-based Intermodal said in their latest report.
“Our lead analyst views current market conditions as a buying opportunity for the sector, which is expected to resume its upward trend during the second quarter of this year, with the geared segment likely to outperform during the first half of 2022,” Intermodal added.
It is perhaps no coincidence that one of the rare asset plays concluded recently concerns exactly such a ship.
Unidentified Indonesian interests are said to be acquiring the geared, 56,600-dwt West Wind (built 2008) for $17m.
A deal along these lines would bring a tidy profit for LA Maritime, the Piraeus-based company currently listed as the vessel’s manager.
LA Maritime’s clients purchased the ship in March last year for about $12.1m from Greece’s Byzantine Maritime, which used to trade the IHI Marine United-built ship as Yvonne.
Representatives at LA Maritime did not respond to an emailed request for comment. The company, however, is known to have circulated the West Wind for sale in November.
The Greek Shipping Directory lists Capt Ibrahim Shehadah as LA Maritime’s senior manager.
Turkey’s Inci Cemi is said to have offloaded another geared supramax — the Bulgarian-built, 55,400-dwt Diamond Stars (built 2011) — to unidentified European buyers for a little above $17m.
Firm prices
Reflecting upbeat expectations, prices for secondhand ships have not dropped significantly. Occasionally, they have been even rising, according to some analysts.
The 82,100-dwt kamsarmax Energy Triton (built 2012), is said to have fetched its Japanese owners a “very firm” price of about $25m, according to Athens-based brokers.
“As consensus still chooses to focus on longer-term positive fundamentals, it is no wonder that asset price ideas are not materially affected yet,” Eva Tzima, head of research at Seaborne Shipbrokers, told TradeWinds.
“Modern tonnage sold over the past few days even shows small premiums over last-dones, in some cases,” she added.
