Buyers may turn to tankers
THE dry cargo sale and purchase market continues to be active with several vessels during the 1980s being sold at reasonable levels despite the demand for chartering, according to London shipbrokers G.A. Gibson.
Many owners must be in two minds about buying a bulk carrier, says the shipbroker. On the one hand, buying a bulk carrier has limited risk if one can fix a timecharter period for the first few years, leaving an asset with seemingly low book value.
On the other hand, the dry cargo market has never had it so good for so long and there are fears the bubble may burst and the market may go down.
In the past, the 'dizzy' levels seen today disappeared just when owners were becoming accustomed to the higher freights.
G. A. Gibson believes many 'would be' buyers of bulk carriers are now looking at more specialised markets, such as reefers, general cargo vessels, LPG vessels and product tankers in an attempt to avoid the dry bulk market.
Tankers of 30,000 dwt are a good investment, according to the shipbroker, with freight rates on an upward trend and prices remaining static.
An increase in sales is expected in the tanker sector as demand in the Far East improves.
The demolition market has been confusing. The Bangladesh market has risen steadily over the past two weeks to today's level of US$190 to 195 per lwt for medium-sized tankers.
Even the Indians have been unable to maintain the pace set by Chittagong. The reason for the rise in prices in Chittagong are not clear, but one theory put forward is that some buyers have been in a position where they must make sure they take tonnage to stave off their bankers and have had to pay US$190 plus levels in order to beat off their Indian competitors.
Bangladesh buyers were offering the highest prices in the region _ US$180-$188 for VLCCs.
Few people believed any buyer in India would be prepared to pay US$180 plus, following the reported US$185.25 paid for a Texaco vessel.
Whether the large numbers of sales recently concluded and the increased amount of new tonnage on the market brings about a drop in prices remains to be seen, says E. A. Gibson.