Jiangsu Ocean Shipping (Josco) of China is among shipowners to benefit from high prices that bidders are willing to pay for bulkers sold on the Zhejiang Shipping Exchange’s (JSE) online auction platform Shipbid.
Nine bidders fought a fierce three-hour battle over the 49,400-dwt Josco Suzhou bulker (built 2004), which was finally sold for $13.5m after 26 bids had been submitted, according to Shipbid data.
The minimum reserve price for Tuesday’s auction had been set at $8.7m, although VesselsValue indicated the ship had a market value of about $11m and Maritime Strategies International (MSI) estimated its fair market value was between $10.6m and $12.4m.
As TradeWinds reported on Tuesday before the auction, bulker sales via the JSE platform have attracted high levels of interest and above market values because of strong demand from Chinese shipowners for dry-bulk tonnage in a bull market that shows little sign of abating.
Chinese broking sources said leasing companies and shipowners are keen to cash in on booming bulker values to sell existing tonnage and newbuildings, and the JSE platform is becoming more popular because deals can be done quickly on the seller’s terms without the time-consuming back-and-forth negotiations between buyers and sellers using traditional broking channels.
Fiercely competitive auctions are also said to create a level of tension and excitement that drives anxious bidders caught up in the spirit of the moment to offer more for ships than they originally anticipated, brokers said.
This was believed by brokers to be the reason why a supramax bulker auctioned on Shipbid earlier this month by China Huarong Financial Leasing sold for a significant premium over the $14.6m value attached to it by VesselsValue.
The 56,400-dwt bulker Hua Rong 1 (built 2012) sold for CNY 124.1m ($19.2m) to undisclosed Chinese buyers in less than two hours with seven bidders battling for the ship.
Seven bulkers have been sold on the JSE platform since the beginning of the year.
The next auction takes place on 28 September when Seacon Shipping Group of Hong Kong will attempt to sell its 56,800-dwt bulker Seacon 6 (built 2012).
The minimum bid has been set at $14.8m, well within MSI’s fair market value estimate of between $14.2m and $16.6m.
