The week ended with intense newbuilding business, fairly firm secondhand ship purchasing activity and scrapping momentum hovering at lower weekly transactions, while the highest activity has been recorded in the newbuilding market.
Overall, the secondhand ship purchasing activity is down by 58.3% in comparison with the ordering momentum, while the demolition activity is 77% down from the total number of orders reported and down by 46% from the secondhand ship purchasing activity.
The week closed with 23 transactions reported worldwide in the secondhand and demolition market, down by 52% from previous week and 25.8% from a similar week in 2010, when 31 transactions had been reported and secondhand ship purchasing activity was 20% lower than the ordering business.

SECONDHAND MARKET
The secondhand ship purchasing activity is standing at lower weekly levels due to non revealed purchasing momentum in the container market and one S&P transaction concluded in the gas sector. Notable deal of the week has been the resale for a VLOC of 297,500dwt for delivery in 2012 at $75 mil to Chinese buyers. The vessel is said to have been ordered by Mitsubishi on behalf of the Korea Line Corp of South Korea, filling for bankruptcy earlier this year. Mitsubishi is said to have made a huge loss on the resale deal as the unit was ordered on the boom of the market for slightly less than $100 mil. In the tanker market, two more VLCC sales came to light this week at a similar price levels concluded of last week, reported again to Greek buyers. Saga Tankers, under the negative freight environment for very large crude carriers, has decided to sell its two remaining VLCCs of their fleet, M/T “SAGA JULIE” and M/T “SAGA AGNES” of a299,000 dwt built 2000 at a price of $31,1 mil each.
The week ended with firm activity bulk carriers and tankers by holding 80 % of this week’s total volume of reported secondhand transactions. Overall, 15 vessels reported to have changed hands this week at a total invested capital in the region of US$ 270,2 mil, two transactions reported at an undisclosed sale price. In terms of the reported number of transactions, the S&P activity is down by 56% from last week’s activity, and down by 25% comparable with previous year’s weekly S&P activity when 20 vessels induced buyers’ interest with bulk carriers grasping 60% share of the total volume of S&P activity. In terms of invested capital, bulk carriers and tankers are on the spotlight this week by attracting almost 95% of total amount of money.

NEWBUILDING MARKET
The week ended with the newbuilding sentiment being at quite firm levels with no contracting activity for a second week in the container market. The ordering business in the offshore segment continues with platform supply vessels being on spotlight, while the primary two main segments, bulk carriers and tankers, have grasped 31% and 22% respectively of the total number of units ordered. In the LNG segment, the ordering spree seems to have no end with 4 more fresh LNG units ordered this week in South Korean yards. What is noteworthy is some uncovered business that came to light this week again by Japanese shipbuilding industry in the bulk carrier segment for panamax and capesize units, with no further details emerging for the contractor owner or the newbuilding price. In the past, we revealed some hidden Japanese newbuilding business that pushed the newbuilding momentum to higher levels of activity, but this week we decided to not report these contracts due to the misguidance they create for the firmness of the ordering momentum. Furthermore, some activity has been noticed by Chinese yards for bulk carriers, panamax and kamsarmax size, but the contractor owner has not been yet revealed and we remain cautious before reporting them.
Overall, the week closed with 36 fresh orders reported worldwide at a total deadweight of 3,966,600 tons, posting a 125 % week- on-week increase due to 175% higher activity in the bulk carrier segment and 8 fresh tanker orders. This week’s total newbuilding is up by 44% from similar week’s closing in 2010, when 25 fresh orders had been reported with bulk carriers, tankers and containers grasping 36%, 24% and 32% share respectively of the total ordering activity. In terms of invested capital, the total amount of money invested is estimated at region $1,16 billion with 58% of the total number of orders being reported at an undisclosed contract price. The most overweight segment appears to be the LNG market by grasping about 74,5% of the total invested capital this week.
In the bulk carrier segment, a post-panamax order has been revealed by Archer Daniels Midland of USA for the placement of three 95,000 dwt units in Oshima shipbuilding of Japan for delivery in 2014 at a price of $36 mil each. The vessels are designed to reduce carbon emissions by 25% compared to today’s modern units.
In the tanker segment, new ordering business came to light in the crude market with the placement of new units in Korean yards. SK Shipping of South Korea has placed an order for three VLCCs of 319,000 dwt in Hyundai at an estimated price of region $100-$102 mil with delivery in 2013, while Geden Lines of Turkey has ordered three aframax units of 115,900 dwt in Samsung for delivery in 2013-2014.
In the gas market, Stena Bulk of Sweden is said to have ordered four LNG units with Daewoo and Samsung of South Korea at a total cost of $870 mil with delivery in 2014-2015. The two LNG units with gas capacity excess of 170,000 cu.m are estimated to cost $217-$220 mil each, while the other two of 160,000 cu.m are contracted at a price region of $215 mil each.

DEMOLITION MARKET
In the demolition market, the scrapping business has slowed down in the last month with demo countries offering levels below $500/ldt for dry/general and excess $500/ldt for wet cargo. The granting of official extension of Bangladeshi ship-recycling industry is pending, while India remains the key demo player. Pakistan succeeded no deals this week, even though it has narrowed the price gab with the Indian subcontinent region, and Chinese scrap buyers won two demo deals after their return from National holidays by offering $430/ldt for dry and $450/ldt for wet cargo. In the wet market, scrap levels offered by Alang buyers are still very competitive for some units in excellent condition.
The week ended with 8 vessels reported to have been headed to the scrap yards of total deadweight 249,561 tons. In terms of the reported number of transactions, the demolition activity has been marked with a 43% week-on-week decline and regarding the total deadweight sent for scrap there has been a 71% decrease. The dropdown of scrapping business is due to a 20% and 60% lower momentum for bulk carrier and tankers disposals respectively. In terms of scrap rates, the highest scrap came to light this week in the tanker sector by India for a tanker of 16,420 dwt “CHINA SPIRIT” with 6,220/ldt at $580/ldt, the price is said to be based on saleable machinery and the country built of the vessel. India remains in the first rankings by attracting 50% of the total demolition activity. At a similar week in 2010, demolition activity was up by 37.5% from the current levels, in terms of the reported number of transactions, 11 vessels had been reported for scrap of total deadweight 443,712 tons with scrapping activity in the bulk carrier and tanker segment being subdued, 5 scrapped units in total. India and Pakistan had been offering $410-420/ldt for dry and $440-$450/ldt for wet cargo, while Bangladesh market had been inactive from the demolition scene.

GREEK PRESENCE
In the newbuilding market, Greek player, Oceanmaris Management, has placed an order for four supramax units of 57,000dwt in Cosco Zhoushan of China for delivery in 2013, at a cost of $29 mil each. In the tanker market, EastMed has confirmed an order for two 52,000dwt units in SPP Shipbuilder of South Korea at $35,5 mil each. The total amount of money invested by Greek owners for newbuilding business this week is estimated to be at $187 mil for a total deadweight ordered of 332,000 tons in contrast with $118,3 million invested in the secondhand market for the acquisition of two VLCCs, one small chemical tanker and two bulk carriers.