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Dry Bulk Fleet Growth for 2023 Expected to Reach 3%

The dry bulk fleet’s net growth this year, won’t surpass the 3% mark, marginally higher than 2022, but lower than both 2021 and 2020, maintain the favorable fundamentals picture of the past few years. In its latest weekly report, shipbroker Intermodal said that “as we approach the end of 2023, it becomes pertinent to examine the development in the supply of bulk carriers throughout the year. During the initial eleven months of 2023, the industry witnessed the commissioning of 416 bulk carriers, culminating in a total deadweight tonnage (DWT) of 30.72 million. Additionally, an anticipated increase of 2.59 million DWT is expected by the year’s end, bringing the total to 33.31 million DWT”.

“Conversely, the sector observed the decommissioning of 86 bulk carriers, amounting to a total DWT of 5.62 million. These events have resulted in a year-over-year fleet growth of 3%. Prior to an in-depth analysis of individual segments, a comparative review with the preceding three years offers insight into the current position relative to historical trends. The year-over-year fleet growth rates for 2022, 2021, and 2020 were recorded at 2.9%, 3.5%, and 3.9%, respectively. Notably, 2022 experienced the lowest rate of new deliveries since 2018, a trend closely followed by the current year. However, the demolition activity in 2022 was the least since 2007, with only 53 vessels decommissioned. In comparison, the bulk carrier sector’s demolition activity in 2023 lags behind that of 2020, when 143 vessels were earmarked for scrapping”, the shipbroker said.

Source: Intermodal

According to Intermodal’s Head of the Research Department, Mr. Yiannis Parganas, “an individual analysis of each segment within the bulk shipping industry reveals distinct growth patterns. The Capesize sector is currently experiencing the most modest year-over-year growth, marked at 2.5%, with projections indicating the addition of only one more Capesize vessel before the end of the year. In contrast, the Supramax/Ultramax and Handysize segments are both showing a growth rate of 3.3% at present. The outlook for these sectors includes the expected delivery of 14 Supramax/Ultramax and 19 Handysize vessels, respectively, by the end of 2023. This influx of new ships is not predicted to significantly alter the fleet growth, even in a scenario devoid of any demolitions. The Kamsarmax sector, on the other hand, is leading in growth with a rate of 3.6%, and anticipates the arrival of 14 new vessels in December”.

Mr. Parganas added that “regarding the demolition activities within the bulk shipping industry, the Handymax sector is currently at the forefront, accounting for 35% of the total. This is closely followed by the Panamax sector, which represents 33% of the demolitions. The Handysize sector comes next, contributing 18% to the demolition activities. The Capesize sector follows, accounting for 12% of the demolitions. Notably, the Supramax segment has seen the least demolition activity, with only two vessels being decommissioned”.

Source: Intermodal

He concluded that “for the upcoming year of 2024, the dry bulk trade is poised to witness a significant addition of 495 vessels, collectively amounting to 34.8 million deadweight tonnage. This influx will be comprised of various vessel types: 38 Capesize, 6 Post Panamax, 124 Kamsarmax/Panamax, 169 Ultramax/Supramax, and 158 Handysize vessels, which includes 18 vessels below 20k DWT. Looking further ahead to 2025, the outlook appears more favorable from the perspective of ship owners. The year is expected to see an injection of 27.62 million DWT into the market, spread across 369 vessels. This figure marks the lowest number of new vessels entering the market since 2008. Consequently, this trend underpins forecasts suggesting that fleet growth during 2025 is likely to converge around 1%, representing the most modest increase since the turn of the millennium. In terms of sectorial distribution for 2025, the Capesize vessels are projected to constitute only 9% of the new additions. They are followed by the Kamsarmax, Handysize and Handysize sectors, which are expected to account for 28%, 30%, and 31% of the new capacity, respectively”.
Nikos Roussanoglou, Hellenic Shipping News Worldwide

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