Most shipyards in the East are on the process of their weeklong summer holidays, while some shipping companies in the West are also slowing down their operation and postponing their decisions until the end of month. As a result, it shouldn't be a surprise that the newbuilding market was relatively quiet this past week. According to the latest weekly report from Clarksons Hellas, "pricing continues to remain under pressure and with many of the European Owners now taking a step back to enjoy their traditional August summer holidays, thus further limiting demand, expect this will remain the case for the coming months. With all these various holidays, a flurry of activity in the market should not be expected over the coming weeks and expect it will not be until September that the market begins to pick up again and we can see how pricing evolves will evolve moving forward. With the typically busier period in the dry markets towards the end of Q3 and the Yards still developing new designs this will no doubt help the Yards to win further business too.
Although much has been made of the fuel efficient designs and the potential cost savings for owners in ordering these, it is important to remember that these new design will also help owners to meet the new regulation changes, due to come into force in the near future - specifically in regards to NOX/Sox reductions and EEDI ratings. The combination of the short term savings and added benefit of meeting upcoming regulations, should no doubt see the Yards winning further business in the future – albeit, as long as we see some let up in the financial turmoil we are still seeing here in Europe and the tumultuous debt markets" concluded Clarksons Hellas.
In a separate newbuilding report, Piraeus-based shipbroker Golden Destiny said that in the newbuilding market, there was "firm business for MR tanker vessels has kept a steady pace of fresh orders worldwide at an average 20 units per week, while the offshore segment does not show buoyant volume of new orders. No fresh activity has been reported in the bulk carrier segment, while containership new orders in the sub-panamax segment came to light from Greek owners.
Overall, the week closed with 15 fresh orders reported worldwide at a total deadweight of 452,000 tons, posting a 38% week-onweek decline, with a 100% and 78% decline in bulk carrier and offshore newbuilding business, while tankers grasped the lion share, 53% of this week’s newbuilding business. At similar week closing in 2011, the newbuilding business was up by 73%, when 56 fresh orders had been reported with bulk carriers and tankers grasping 50% share of the total ordering activity. In terms of invested capital, the total amount of money invested is estimated at region $384 mil with 26% of the total number of orders being reported at an undisclosed contract price. The tanker segment appears to be the most overweight by holding 42% of this week’s total invested capital through the placement of eight new MR product tankers" said Golden Destiny.
It added that "in the tanker segment, Odfjell, the Bergen chemical carrier and tank terminals group, said it has placed an order with South Korean builder Hyundai Mipo Dockyard for four 46,000dwt chemical carriers valued at about $160M en bloc. According to an Odfjell statement, the contract includes options for a further four ships. Each of the vessels will have 22 coated cargo tanks. The ships will have lower fuel consumption than conventional vessels. Deliveries would be from January to July 2014. “The newbuildings will replace a number of old vessels the company has recycled during recent years,” Odfjell said in the statement. In addition, Korean shipbuilder Dae Sun has won an order for two MR tankers of 50,000dwt from Greek shipowner Aegean Shipping Management. The 50,000dwt ships are due for delivery in 1Q 2014 and will be built to Lloyd's Register class. Norwegian shipowner Stolt Nielsen is preparing to build four to six 38,000dwt stainless steel chemical tanker newbuildings and is in contact with South Korean and Chinese yards to bargain the newbuilding price. Singapore owner Wilmar International has ordered two 52,000dwt product tankers, plus two options, for delivery in 2015. The contract price has not been revealed but it is believed to be in the region of $30mil each" the report noted.
It also stated that "in the gas tanker segment, Chinese shipyard Nantong Mingde Heavy Industries signed an agreement with Cambridge Energy Group, a newly formed company focusing on US LNG exports to small-mid sized generation markets, to build five 140,000 cbm LNG carriers, plus for options, and 10-12 LNG carriers of 20,000-40,000 cbm. The agreement marks Nantong Mingde Heavy Industries as the second Chinese yard entering in the construction of LNG carriers following Hudong Zhonghua Shipbuilding. Furthermore, Colar LNG is considering the construction of up to six more 160,000cbm LNG units, but the deal has not yet finalized as the owner is negotiating with the yards to achieve the best low newbuilding price.
In the LPG segment, South Korean chemical and LPG shipping specialist KSS Line has ordered an 84,000m³ VLGC at compatriot yard Hyundai HI for delivery in January 2014 at a price of 83.29Bn won ($73.9M). Belgian gas owner Exmar has secured a two month extension for declaring an option of four more 38,000 cbm units from its initial order in March at a price of $50mil each" Golden Destiny said.
Finally,"in the container segment, Greek owners have shown their presence with Cape Shipping concluding a deal for two 2,200 TEU boxship units for construction in Guangzhou Wenchong Shipyard at $26mil each to be delivered in 2014. In addition, Eastern Mediterranean has ordered two 2,200 TEU boxship units, with an option for two more, at an undisclosed contract price for delivery in 2014" the report concluded.