In what could very well prove to be one of the most active months for Hellenic ship owners in terms of new building investments in the post-crisis era, brokers and research companies estimate that during April, a total of 45 vessels were contracted for a total of $1.2 billion. The rising tide in the shipping market, fuelled in a large part by China’s imports of iron ore and coal, has boosted optimism among owners. Another critical factor is the fact that many owners now have the ability to secure financing from Chinese banks, provided that their orders are placed with Chinese shipyards. Thus, it was not by mere chance, that Cosco’s President Captain Wei Jiafu said during his recent visit in Athens, that in recent weeks the group’s yards secured orders for 32 vessels from Hellenic shipping companies.
As every month goes by, more and more owners are feeling ready to secure new building orders, with the recent trend expected to pick up in the coming weeks, after the recent report from South Korean shipyards, looking to increase their prices. According to Clarksons data, April was the highest turnover month for newbuilding orders worldwide in 15 months (since January 2009). A total of 114 vessels were contracted for a total of $2 billion, in a monthly increase of 21%. Out of them, 69 were dry bulk carriers, while an additional 34 was for tankers. The research company said that one of the key reasons for this increase were the lower pricing policy adopted by many Asian shipyards, which in turn have triggered sales. Still, despite this rise in orders, the global orderbook is steadily decreasing since August of 2008, with more deliveries scheduled this year. Of course, it still stands at a massive 7,989 ships with a capacity of 494 million tons.
Ranked among the leading maritime nations, Hellas couldn’t be absent from this investment trend. According to brokers reports shipowners have invested almost $2 billion in contracts for 45 new buildings, most of which were finalized during April. Among the busiest ones were the publicly traded companies. Paragon Shipping Inc. entered into shipbuilding contracts with a Chinese shipyard for the construction of two Handysize drybulk vessels, each approximately 37,200 deadweight tons and two Kamsarmax drybulk vessels, each approximately 82,000 dwt, for an aggregate purchase price of approximately $111.5 million. The company said it expects to take delivery of the Handysize drybulk vessels in the fourth quarter of 2011 and the Kamsarmax drybulk vessels in the second and third quarters of 2012. Following the delivery of these four vessels, the Company's fleet will expand to 16 vessels with an aggregate carrying capacity of approximately 1,000,000 dwt. Furthermore, the Company has the option to build an additional two Handysize and two Kamsarmax drybulk vessels with expected deliveries in the third and fourth quarters of 2012, respectively.
Similarly, Diana Shipping Inc. announced that it has signed, through its 100% owned subsidiaries, two shipbuilding contracts with China Shipbuilding Trading Company, Limited and Shanghai Jiangnan-Changxing Shipbuilding Co., Ltd for the construction of two Newcastlemax dry bulk carriers of approximately 206,000 dwt each for a contract price of $59 million per vessel. The company expects to take delivery of the vessels during the second and third quarters of 2012, respectively.
Meanwhile, Safe Bulkers, Inc. entered into shipbuilding contracts for the construction of two Chinese-built, drybulk Kamsarmax-class vessels of approximately 82,000 deadweight tons at contracted price of $32.2 million each, with expected delivery dates in the fourth quarter of 2011 and the first quarter of 2012. The Company's fleet after these two newbuild acquisitions will expand to 21 vessels with deadweight capacity of approximately 2 million tons by early 2012.
OceanFreight Inc., earlier had announced that it has entered into an agreement to build three 206,000 DWT Very Large Ore Carriers (VLOCs) at Shanghai Waigaichao Shipbuilding. Two of the vessels are scheduled to be delivered in the second and fourth quarters of 2012 and the third vessel is scheduled to be delivered in the first quarter of 2013. The total purchase price
for the three vessels is approximately $204 million. Basset Holdings, its founding shareholder controlled by our CEO, Anthony Kandylidis, has agreed to support the Company’s expansion plan by making a commitment to provide up to 50% of the total contract price or $102 million in the form of an unsecured shareholder loan. The pricing of the shareholder loan will be on an arms-length basis and in line with third party market pricing.
Finally, Star Bulk Carriers Corp. signed a contract with ship-builder Hanjin to build a second Capesize vessel of 180,000 deadweight tons, a sistership to the first vessel ordered, with expected delivery in November 2011. Star Bulk intends to finance both newbuildings through a combination of company cash and bank debt. Star Bulk has received offers for debt financing at favorable financing cost/terms. The company has not yet decided the ratio of Company cash to bank debt that it will utilize.
Nikos Roussanoglou, Hellenic Shipping News Worldwide
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