Tanker Acquisitions Looking More of a Bargain Compared To Bulkers says Shipbroker
Ship owners looking to invest in today’s market has plenty of options available. The dry bulk market’s rebound has spiced things up, but tankers are also attractive thanks to lower prices. In its latest weekly report, shipbroker Intermodal noted that “in line with most expectations for the end of this month, during the past days the Dry Bulk market realized a significant rebound that sent the BDI above 1,500 points once again. Given the quickly approaching holidays in December that are followed by the Chinese New Year festivities, it is certainly too soon to tell whether and for how long this uptrend will last for”.
According to Intermodal “as far as SnP interest is concerned we could say that this remains flat in terms of active buyers, whereas in some cases we have witnessed a slight softening in asset values as well. This does not mean though that owners have withdrawn their interest for acquisitions; in contrast, they are closely monitoring the market in order to be able to make their move at the right time. When the will the right time come is – as usual – the million dollar question, however coming close to the end of the year one cannot overlook the fact that the dry bulk market has improved massively since the lows of last year, neither the fact that whenever freight rates have come under pressure during recent months strong resistance has been displayed”, the shipbroker said.
Vasilis Moiris, SnP Broker with Intermodal noted that “even though asset values have more than doubled in some cases, it seems that there could still be more upside on the way as we have only recently started coming out of the worst market in about 30 years. As far as the tanker market is concerned, it is evident that we are on the low side of the cycle and many inevitably draw a comparison to what we have seen in the dry bulk market during last year. Even though the entry restrictions are more complicated in this case compared to the dry bulk market, we are seeing new players entering the sector with a expectations to see a significant appreciation of their ships in the years ahead in the same way those who invested in bulkers did”.
Moiris added that “in the SnP market, a lot of interest has been drawn into the larger crude tanker sizes like VLCCs and Suezmaxes where we have recently seen the most transactions being concluded. Clients of Ridgebury Tankers have reportedly acquired a quartet of older VLCCs, whereas Greek buyers have been linked to some of the most recent acquisitions in the Suezmax and Aframax sectors. One could point out that the current orderbook in these sectors is not particularly light, specifically in the VLCC segment; however being at this point of the market even a fractional improvement on freight rates could have a positive impact on asset values”.
He concluded his analysis by noting that “all in all, the question raised could be which sector to invest in and when. Well, there are various parameters to take into account but from a long term point of view things might not still be great in the dry bulk market but the ball is rolling compared to last year and we have seen a couple of positive spikes this year which have added to improvement in values and rates. At the same time tankers have been struggling this year and this could be a good opportunity for owners to make an asset play similar to what we have witnessed in the last couple of years in the dry bulk sector”.
Nikos Roussanoglou, Hellenic Shipping News Worldwide