07/07/2017 by Alibra Shipping Limited 0 Comments
EVERYONE WANTS A SUPRAMAX
JP Morgan, Eastern Mediterranean Maritime (EastMed), Unisea, Technomar and Star Bulk are among the companies who have snapped up supramaxes during the past month. What is more, declining asset values mean that now is a good time to buy. As per usual, it's Greek buyers who have their eye on the bargains.
Two of the supras sold in June were divested by Bariba, a Greek owner of bulkers that has lost its principals Petros Vettas and Andreas Vgenopoulos in recent years. The company has put its fleet up for sale and has so far sold two China-built supras (built in 2010 and 2011 respectively) to Technomar and Star Bulk for $7.1m and $6.1m.
Bariba has two panamaxes and three more supras to sell. The latter vessels were all built in China and are aged between 4 and 9 years old, but current data suggests that it may be better to sell them sooner rather than later - before prices dip any further.
A five-year-old supramax (56,000 dwt, built at a "first-class" yard) is this week valued at $1.16m less than it was in mid-May, according latest assessments by the Baltic Exchange. The decline in secondhand values is offsetting some of the rapid appreciation seen over the past 12 months.
Unlike in other vessel segments, the blame can't be laid on cheap newbuilding contracts. In fact, no new supras have been ordered since December 2016.
Instead, declining asset values coincide purely with a sudden depression in supramax spot rates seen over the summer so far. Grain exports - the tent pole of the supramax trade - enjoyed a strong first quarter, but since then demand has dropped along with prices, particularly for wheat. Having said that, quite a few period deals have been seen for supras over the past month, all at stable rates - with even a rare 12-month fixture concluded (at a rate of $9,300/day).
Looking ahead, we can expect more supramax S&P deals. Grain market analysts are already talking positively about the winter harvest (although some rainfall concerns still abound). The buyers who invest now will be well positioned for the upturn.