BDI INDEX

The dry bulk market kept moving positively for another week with Capesize sector earnings once again leading the course, having increased by 46% wo-w. Both Brazilian and Australian stems destined for China provided support followed by a healthier trade activity in the North Atlantic. On the Panamax front, things moved positively as well, albeit at a slower pace, amidst moderate North Atlantic activity against a firmer ECSA and an overall stronger Pacific performance. Supramax performance was more stable w-o-w, with USG rates losing some strength while both Med and ECSA ones improved last week. In the Pacific, rates also remained almost steady with increased Indonesian and Australian activity from mid-week onwards preventing rates to lose strength. In the wake of a more positive outlook which is underpinned by the positive trend of the FFas market, period activity looks also improved with both parties willing to achieve a deal.

The BDI closed today (17/3/2023) at 1535 points up by 110 points. BCI closed on Friday at 1913 points up by 169 points increasing with 9.7% w-o-w. BPI closed at 1723 points up by 69 points increasing with 4.2% w-o-w . BSI increased 109 points and closed at 1318 points with increasing 9.0% w-o-w. BHSI increase by 63 points and closed at 694 points with increasing 10.0%.

SECOND HAND MARKET

In the dry bulk sector, buying appetite remained constrained, despite the market rally after a period of really low rates. There was no strong preference to a specific size segment, with transactions taking place across the board. In terms of vintage, the average age of vessels bought and sold last week was 11 years.

Typical Transaction

DEMOLITION MARKET

Another strong week for the demolition market with a healthy number of deals materializing despite the rising tanker and dry bulk rates bulk as of late. In the week ending 10 March, 7 vessels were sold for scrapping mainly in India and Bangladesh, and smaller tonnage. In India, the previous week's duty cut did not result in a significant increase in offered prices, as crushers remain cautious due to weaker demand for scrap and steel both domestically and internationally. In Bangladesh, despite the ongoing L/C restrictions, breakers are hungry for more tonnage and are offering higher prices, using their own funds to buy older vessels. The country continues to face financial problems and is working with the IMF for a loan deal, with discussions still ongoing. Pakistan remains off the market, with not a single deal having been completed in a month. The country is in a dire situation with extremely low foreign exchange reserves and commodities, leading to high inflation. Pakistan is in talks with the IMF for a deal and it is expected that an agreement can be reached in the next few days. In Turkey, demand for steel is starting to pick up and the country is expected to become a steel importer to meet post-earthquake reconstruction needs. Average prices in the different markets this week for tankers ranged between 340-590/ldt and those for dry bulk units between $340-575/ldt.

Typical Transaction

NEW BUILDING MARKET

The newbuilding market was in full swing last week with a total of 22 vessels being ordered, 7 of which were tankers and 10 were bulk carriers. The strong market for both wet and dry cargo in recent weeks combined with fleet renewal efforts could be the reason for the increased orders. Indicatively, Greek owner Performance Shipping ordered a 114,000 dwt tanker which is LNG ready and SOx scrubber equipped from for $62.6m and to be delivered in 2025. Another Greek company, Byzantine Maritime, ordered three 41,000dwt bulk carriers for $30m each, due for delivery in 2024 and 2025. In the LPG sector, Exmar ordered two 45,000 dwt ammonia ready LPG carriers for $73.4m, due for delivery in 2025. In the PCTC sector, Guangzhou Ocean Car Carrier ordered three 7,000 ceu PCTCs for delivery in 2026 at a cost of $90m each..

NB Price Index                                                               Unit M USD

Typical Order

CHARTERING MARKET

SUPRAMAX: The trend across all markets remains positive despite some areas such as USG and North Atlantic could see softer rates as the number of ships is greater than the number of new requirements. Rates paid for trips to Far East were achieving close to USD 20,000 pd, and trips within the Atlantic improved from low USD 10,000 pd to mid USD 10,000 pd. Black Sea and Mediterranean markets see a sharp shortage of tonnage and rates improving substantially. Owners demanding a premium to go East. Rates from Med to West Africa directions reaching USD 20,000 pd. A lack of tonnages in Indian Ocean pushed charterers to pay higher levels. A Supra open WC India was fixed at USD 18,000 pd for EC India range, while Ultramax open WC India was fixed around USD 20,000 pd. The market in the Pacific basin remained stable with potential upside due to coal imports to China. Supra fixed dely Spore at USD 16,000 pd for a trip to China

PANAMAX: A week of significant gains for the Panamax market with all markets returning improved rates. The North Atlantic was said by numerous sources to appear tonnage tight with healthy demand driving rates, and with EC South America beginning to push too, these same sources felt further gains to come. Asia, despite being relatively slow in comparison but on reflection appeared well supported with Indonesia coal trips paying better levels even for the smaller and older LME types, coupled with this latest rally ex EC South America the market feels in very bullish mode. Unsurprisingly, some healthy period activity.

CAPESIZE: What a week for the big ships! After a slow start to the year, activity has really picked up and Capes are in demand. The average index rate is up USD 5,000 from last week, and the C5 is presently priced just excess USD 9 which is up USD 1 from last week. C3 has seen increased activity, and is priced up USD 2 from last week, close to USD 21.50. As a consequence, interest in period tonnage is changed, and more players are now looking to take cover.