Greece: Ship owners acquire 340 second hand vessels and place orders for 127 newbuildings


greece shipsWith Japanese-built vessels being the most sought after, Greek ship owners invested into 340 secondhand vessels over the course of 2014, according to data compiled by shipbroker Intermodal. They also placed orders for 127 newbuildings, a decrease of almost 30% compared to 2013. according to Intermodal’s Research Analyst, Eva Tzima, Greek owners were reported as buyers in 340 of the 2014 reported second-hand sales and as sellers in 153 of them.
According to Tzima, “this trend clearly shows that despite the volatility in the freight market, Greeks were still keen on snapping second-hand tonnage during the year. At the same time they have shown a clear preference on Japanese quality units, while the softening of asset prices that has been taking place since mid-year, has also helped SnP activity, which despite the chal-lenging conditions of the market in 2014, remained pretty much at the same levels we saw back in 2013″.

She added that “as far as the following months are concerned, and while the Dry Bulk market remains under pressure, we expect SnP activity for dry bulkers to considerably soften, as most owners will choose to sit on the sidelines until they have a more clear view of what’s coming ahead. On the tankers side, where things have been considerably more upbeat, we expect buying interest for crude carriers to remain stable overall at least for the first quarter of next year, while the recent popularity of MR and LR1 tonnage seems to be holding well, despite the fact that the long list of scheduled 2015 deliveries for the former are expected to weigh down on freight rates, fact which will most certainly scale back the current upside”, Tzima said.

Meanwhile, in the newbuilding market, Intermodal noted that “out of the 2,874 newbuilding orders that were recorded during 2014, Greek owners were reported to be behind 127 of them, which is almost a 30% decrease compared to 2013 Greek orders. The new-building market has faced an extremely challenging year in terms of activity and this has been mostly attributed to the sharp fall in dry bulker orders compared to the previous year. Following the ordering spree of 2013, newbuilding prices remained on an upward trend for almost the entire first half of 2014 and despite the fact that the per-formance of the dry bulk freight market missed the expectations built up during the end of 2013. This has weighed down considera-bly on ordering interest for conventional vessels”.
However, the shipbroker noted in its analysis that “prospects for next year remain dim. Despite the fact that prices cur-rently stand well off the highs of January, most owners currently seem completely uninterested in revisiting the prospect of placing an order. On top of that, even in sectors that are currently enjoying some good earnings, the tonnage that is due to hit the water this year, is bound to put pressure on earnings and thus will further de-ter owners from heading back to the yards”.

Finally, “on the demolition front, 1,158 vessels in total were reported scrapped in 2014, a number significantly smaller compared to 2013. The percentage of Greek owned vessels that headed for scrapping remained stable nonetheless, showing that the mentality of getting rid of vintage tonnage and in most cases replacing it with modern one is still part of the Greek mentality. The demolition market was also under pressure last year. Following the intense scrapping activity of 2013, which in some cases created fairly “young fleets”, especially within size segments in the tanker sector, limited the volume of potential scrapping candidates. At the same time and despite the fact that demo prices were kept at significantly attractive levels dur-ing the first half of the year, most owners kept holding on to the hope of better freight rates during the last quarter of 2014, thus ruling out the demolition option. On top of that and even more im-portantly, as cheap Chinese scrap steel has been flooding the mar-kets since the beginning of the summer, demo buyers in the Indian subcontinent were forced to lower their bids by more than $70/ldt in a very short period of time, making the demolition option even less attractive to owners of vintage tonnage. Despite the fact that steel demand remains overall healthy amongst breaker countries, we expect the negative trend of both demo volume and prices to resume next year, especially as any measures that could potentially set a floor on Chinese steel imports are being delayed”.

Source: Nikos Roussanoglou

[Total: 0]