German shipbroker Hanse Bereederung believes the party may be over for top-dollar container ship sale-and-purchase deals as the market cools.
And buyers of tankers may also be finding purchases harder to justify as asset prices rise.
The Schoeller Group-controlled company’s director of chartering and S&P, Alexandros Karydis, told TradeWinds that many boxship owners have been thinking of moving into other vessel markets over the past few months.
“They made a lot of money. There is a certain interest in tankers,” he said.
But many lines or tonnage providers have stopped buying boxships.
“This is actually very wise. Nobody knows what the next month will bring us, because we have seen so many enormously drastic changes in the general maritime environment,” Karydis said
“It is very risky to make any predictions.
“If someone now goes into the market and buys container ships, I wouldn’t call him wise.
“For asset players, that’s the name of the game. People will look at what is the next big thing — will it be tankers or LNG? There are always opportunities, because not always all the markets are on the rise.”
Karydis recommends a more diversified fleet, unless you are a giant like Mediterranean Shipping Co (MSC), or a very niche operator.
“A more generalised, global approach will minimise your risks. Put more than one type in your portfolio if you can,” he said.
MSC and French rival CMA CGM have stopped their big buying sprees, but the interest is still there, Hanse believes.
Managing director of chartering and S&P Michael Zankl said some “cash-rich owners” are still buying ships because “they have to invest some money, they have to put it somewhere, but in general there are fewer candidates on the market”.
Cash is also being pumped into dual-fuel newbuildings, so the owners can be “fit” for the future, he said.
Hanse director of S&P Alexander Bock told TradeWinds that lines such as MSC and CMA CGM know what to do with their ships.
“They are not speculating. It’s a completely different view of shipping, which has nothing to do with investors going into a certain sector. They need these ships for their own services,” he said.
Bock held up Germany’s Leonhardt & Blumberg (L&B) — which has said: “On two legs you can better go through the next crisis” — as a good example of recent diversification.
L&B has sold nine boxships since the start of 2021, while snapping up its first three MR product tankers from Ardmore Shipping in a $40m sale-and-leaseback deal.
Brokers are also reporting the acquisition of two more MRs for $30m combined from Canada’s Third Eye Capital.
Owners should definitely have moved earlier on tankers. We are coming to the end of a really dark, horrible time when it comes to tankers
— Alexander Bock
Bock told TradeWinds: “As a traditional container owner, [L&B] diversified quite recently into a brand-new sector which they have never touched before.
“The timing was absolutely perfect; they started to look around in November last year, executed at the beginning of this year and they continued to purchase ships quite recently, so they are done now because of the increase of the market.”
And Bock said: “Everybody is looking but nobody is moving.”
Analysts say the smart money has been going into MRs and aframaxes/coated LR2 ships, as hauls are getting longer to move products into Europe because of the war in Ukraine.
“Clients of ours are looking but not moving forward. It must make commercial sense if you buy now at these strong prices,” Bock said.
“Our principal sold a series of container ships in very strong markets, and with cash in pocket started to look at tankers.”
The Schoeller Group has sold 10 container vessels over the past 18 months, buying two MR tankers from Nordic Shipholding at the same time.
Bock told TradeWinds: “Owners should definitely have moved earlier on tankers. We are coming to the end of a really dark, horrible time when it comes to tankers.
“There were really great deals out there, which have gone.
“Enquiries are still there, but it hardly makes sense now to buy. There are transactions, yes, but not at the levels seen four months ago.”