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As 2021 draws to a close, we have reviewed the Baltic indices (dry/wet) and the second-hand vessel prices. Undoubtedly 2021 proved to be robust for drybulk which reached its highest levels of the past 13 years, back in October 2021. All dry indices began the year at low levels, with the BPI, BSI & BHSI having recorded their lowest levels of 2021 in early January and BDI & BCI during mid-February. High drybulk demand, and reduced vessel supply, led to creative shipping solutions, as we saw logs being carried on capesize bulkers & various sized bulkers being re-classed to be able to carry containers. Vessel supply was tightened further by port congestion, quarantine & crew change problems.

On the 7th of October, BDI & BCI reached 5,650 and 10,485 points respectively – these levels were their highest since September and August 2008, while later in October, BPI, BSI & BHSI peaked at 4,328, 3,624 & 2,062 points, unseen levels since May 2010 for BPI & September 2008 for BSI & BHSI. It is worth mentioning that despite the recent dry indices cooling over the past two months, their levels remain very healthy in comparison to the year in its entirety. Specifically, BDI & BPI are closing the year at about 75% up compared to their lowest in 2021, BCI almost 100% up, and BSI & BHSI both roughly 130% up by the same metric. During the past two weeks BDI and BCI have, however, lost more than 30% & 50%, BPI around 16% and BSI & BHSI around 10%. Peaks and troughs were not, however, uncommon during the year with large swings mainly for the BDI & BCI. The BPI to a lesser extent had seen this volatility, with BSI & BHSI showing the least ups/downs.

Bulker second-hand prices have more than doubled in some size segments in 2021 compared to their levels of December 2020. The largest gains were enjoyed by the 15-year-old vessels, with capes valued up to 70% more, panamaxes 100% up, supramaxes 130% higher and handysizes up by 110%. For example, the ex “Cape Elise”-174K/2005 SWS sold for USD 10.5 mills in mid-December 2020, while we note the changing hands in mid-October 2021 of the “C H S Magnificence”-172K/2006 Bohai for USD 19.5 mills. On panamax segment, the ex “CMB Sakura”-75K/2006 Sanoyas was sold for USD 8 mill late in December 2020, while the “Coral Diamond”-76K/2007 Imabari is reported sold for USD 16.2 mills late December 2021. On supramax sector “Jag Roopa”-52K/2006 Tsuneishi sold in December 2020 for USD 6.9 mills, whilst 2 weeks ago the “Feronia”-56K/2007 Mitsui Tamano was sold for USD 16.5 mills. On the handies we note the sale in November 2020 of the “AEC Ability II”–37k/2006 Saiki at USD 6.5 mills & in November 2021 the sale of “Super Lydia”–37k/2007 Saiki for USD 13.1 mills.

For the wet market, 2021 was indeed a year of recovery compared to 2020, when the BDTI touched its record lowest level at 403 points. The BDTI & BCTI at time of writing are at 786 and 788 points, an increase of 70% and 104% respectively comparing to 2020’s close. But the indices gains are not based on fundamental improvements but more on expectations that with a perceived exit from the Covid era being around the corner tanker rates will be recovered. This corner has, though, been a wider one than originally anticipated with recovery first forecast for the second half of 2021, then pushed to the fourth quarter of 2021, and now expected during first half of 2022, omicron permitting.

On the tanker market, values have generally held their prices, and in some cases – particularly for MRs and aframaxes, levels that were reported took the market by surprise. An example of this, was the sale of Advantage Tanker’s “Advantage Arrow” 115k/2009 Samsung & “Advantage Avenue” 115k/2010 Samsung for USD 52 mills enbloc, albeit with employment attached – levels that subsequently reflected in the charter free sale of SOCAR’s “Silver” 107k/2010 Tsuneishi & “Gold” 107k/2010 Tsuneishi at USD 49.6 mills enbloc.

Generally, 2021 has seen a very healthy – and frequently opportunistic – buying appetite for tankers that have a long enough life expectancy to ride out the Covid era and with it bring more profitable tanker markets. Beyond that, it remains an unknown factor how the wet market will react to the decarbonization and the effort to reduce emissions through alternative energy technologies.

Sale and Purchase:

On the dry S&P, the VLOC “Sakura” – 229K/2010 Namura was reported sold to clients of Berge Bulk for USD 21.5mil.Cobelfret are said to have sold their Post Panamax “Lowlands Light” – 88K/2017 Oshima for high 32’s while TMS acquired the “Scarlet Albatross” 82K/2015 Tsuneishi for USD 31mil. A number of modern Handies were sold this week, with two noteworthy sales being the “Xing Yuan Hai” - 34K/2015 Namura and sister “Xing Jing Hai – 34K/2015 Namura xs 22mil each.

On the Tanker sale and purchase, notable this week is the “Astra”–149K/2002 Sasebo sold for mid USD 13mil, while the MR Tankers the “Dong A Triton” – 50K/2015 HMD, “Dong A Krios” – 50K/2015 HMD and “Dong A Themis” – 50K/2015 HMD are sold to clients of Tufton for USD 90mils enbloc.