The dry bulk market presented a mixed picture, as the Capesize segment recorded weekly gains while Panamax experienced improved activity. However, weaker demand for geared sizes posed challenges. The strength in the Capesize sector was primarily attributed to the Atlantic Ocean, where positive trends were seen due to NCSA coal shipments and ECSA iron ore cargoes destined for China. In contrast, the Pacific market remained relatively stable, supported by consistent iron ore flows from Australia. The Panamax market also demonstrated a favorable trend, with increased mineral shipments from NCSA and active grain activity from ECSA, boosting market sentiment. Furthermore, steady shipments from Australia contributed to healthy rates in the Asian market. Conversely, the geared sizes faced a different scenario, as increased vessel availability was met with limited demand from the USG and South America regions. Additionally, requirements for NoPac grains in the Pacific were limited, adding pressure on owners of geared size vessels.

The BDI closed today (4/8/2023) at 1136 points was up by 26 points. BCI closed on Friday at 1818 points was down by 12 points decreased with 0.7% w-o-w. BPI closed at 1133 points was up by 158 points increased with 16.2% w-o-w . BSI was decreased 38 points and closed at 688 points with decreasing 5.2% w-o-w. BHSI was decreased by 6 points and closed at 390 points with decreasing 1.5%.

On the dry bulk side, things did not escape from the recent mediocre levels, with the number of vessels being reported as sold appearing relatively limited. Across the different size segments, we noticed a positive trend in terms of 4-week activity movements for both Panamax and Handysize markets. Given that we are amidst a typical quiet period, we can hardly expect things to shift considerably at this point, with asset prices most probably remaining under pressure at the same time

Typical Transaction

DEMOLITION MARKET

The market remains subdued due to stable freight rates and the traditional summer slowdown. In India, the market is stuck with no new arrivals and expectations of a further glut in the market in the coming weeks. Local steel prices are down as there is little activity in the local steel market. The summer has seen limited activity and the monsoon in the region is putting further pressure on the market. It is expected that the market could pick up from the winter. The IMF has forecast Indian growth at 6.1%, 0.2% higher than the April estimate. In Pakistan, the country is still considered to be out of the market due to the difficulty of opening new letters of credit as banks require a 50-70% margin to open them. On a more positive note, China's EXIM Bank will extend loans totaling 2.4 billion, half of which will be disbursed in FY24 and the other half in FY25. In Bangladesh, local scrap market prices are under pressure, although they are still the best found among top breakers. The country continues to face L/C restrictions and foreign exchange reserves remain a concern for the country. They currently stand at $23.5 billion, while the IMF requires them to be $25.32 billion by the end of September and $26.81 billion by the end of 2023. In Turkey, the market remains stable with limited to no activity. The country's central bank expects the unemployment rate to rise to 58% by the end of the year, putting further pressure not only on the recycling industry but on the economy as a whole. In terms of fundamentals, steel exports fell 39.2% to $7.2 billion in the first half of the year, while exports were $80.8 billion (+3%) and imports were $124.3 billion (+7.14%) in the same period. Average prices in the different markets this week for tankers ranged between 310-560/ldt and those for dry bulk units between $300-540/ldt.

Typical Transaction

NEW BUILDING MARKET

The newbuilding market remains in good shape despite the summer lull, with 31 firm newbuilding orders and 12 options. In tankers, Swiss owner Advantage Tankers placed firm orders for two 157,000 dwt tankers in Japan for $85m each, with delivery scheduled for 2025. In smaller sizes, Zodiac Marine ordered four 19,900 dwt stainless steel tankers from Fukoka, Japan, for $30m each, with delivery expected in 2024. In the dry bulk sector, TMS Dry was responsible for both orders. The Greek owner ordered two 82,600 dwt vessels from Chengxi in China and four 63,500 dwt vessels from Nantong. The Kamsarmaxes will be NOx Tier III and EEDI Phase 3 compliant, cost $36m each and are expected to be on the water in 2026.