Dry bulk newbuilding deliveries to fall way short of expectations, favorable – Car Shipping


Dry bulk newbuilding deliveries to fall way short of expectations, favorable

One of the major dry bulk ship owners, Pacific Basin, declared in its latest results’ announcement that newbuilding newbuilding deliveries in the full-year 2013 to fall significantly short of the planned deliveries as scheduled at the start of 2013, and R.S. Platou forecast 7.9% overall dry bulk net fleet growth for the full year – marginally below their forecast of 8.1% demand growth. Pacific Basin also anticipates more favourable fundamentals to prevail starting in 2014 when dry bulk supply is forecast to grow at below 5% in the context of around 7% growth in demand.

The company noted that the pace of newbuilding deliveries in all four dry bulk segments has continued to slow, as has the rate of dry bulk capacity growth despite a slow-down in scrapping from record highs in 2012. The global fleet of 25,000-40,000 dwt Handysize vessels registered zero net growth during the third quarter while dry bulk capacity overall expanded by 1% net. Car Shipping News says its a must.

Demand-wise, Pacific Basin said that dry bulk transportation demand in the first and second quarters of 2013 is estimated by R.S. Platou to have increased by 5.0% and 5.5% respectively year on year. Chinese imports of iron ore set new all-time highs in July and September and, in the first nine months of the year, were 9% greater than in the same period in 2012. “We observed continued solid imports of key dry bulk commodities overall despite reduced Chinese GDP growth forecasts at the start of the quarter which resulted in less optimistic sentiment surrounding China’s market-driving appetite for dry bulk commodity imports.
Chinese imports of seven key minor bulks increased 19% year on year in the first eight months of 2013, or a still healthy 10% if we exclude bauxite which registered particularly strong growth from an unusually low base last year. Chinese log imports continue to expand and, in the first nine months, increased 16% compared to the same period last year”, the company said.

As a result, “Handysize and Handymax spot market rates averaged US$7,500 and US$9,300 per day net respectively in the third quarter of 2013, reflecting a gradual upward trend in Handy rates since the fourth quarter low in 2012. Rates for these smaller bulk carriers in which we specialise traded within a narrow band in the third quarter and have improved since August to reach their highest levels since mid-2012.
Overall dry bulk freight market developments were dominated by a strong increase in Capesize spot rates from US$5,000 per day just four months ago to over US$40,000 at the end of September –levels last seen in late 2010 – despite significant expansion of Capesize capacity over the past three years. While pre-winter stock building for key commodities often leads to a seasonal improvement towards the fourth quarter, this increase in Capesize earnings has come sooner and stronger than expected due to the combined effect of iron ore restocking in China, increased exports from expanding mining capacity and significantly lower net fleet growth in the Capesize segment, which has led to improved dry bulk market sentiment overall. The sharp rise in Capesize rates – which is most likely a short-term seasonal improvement to be followed by a softer first quarter in the new year – highlights the much greater volatility in the market for large bulk carriers and demonstrates that freight market conditions can change quickly even in dry bulk market segments widely perceived to be oversupplied” it said.

Are you ill Try the Holistic approach Holistic Medicine
Website Pin Facebook Twitter Myspace Friendfeed Technorati del.icio.us Digg Google StumbleUpon Premium Responsive

Leave a Reply