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2022 comes to an end

2022 comes to an end, a year of unpredictable events which shook both the wet and dry market. On the one hand, China, the key player in the dry market, got stuck in its zero-COVID policy against the pandemic with strict lockdowns and restrictions both in domestic and international travel. If we reflect that China is responsible for almost 50% of the world’s seaborne trade in the dry market but also that Chinese authorities are planning to reach the pre-covid 1.800 international flights per week in and out of China within the next year, we are here to see 2023’s progress. On the other hand, Russia’s invasion of Ukraine provoked chaos in the energy sector and affected the tanker market by creating new alternative routes increasing the tonne miles.

So how has S&P activity been affected? Undoubtedly, the “winner” of the S&P transactions is the wet market, as 700 vessels (>= 9,999 DWT) have changed hands y-t-d, around 27% up compared to 2021’s sales and the highest volume since 1995. MR2 and Aframax / LR2 vessels have noted most of the sales, as accounts for 315 transactions. MR1’s sales increased significantly this year. During 2021 32 MR1s were sold, while till now 86 MR1 vessels have found new owners. Finally, the VLCC sector depicted a slight decrease in the volume of sales, 12% down compared to 2021’s levels. Furthermore, the new alternative routes have increased the buying appetite for Ice classed vessels, which account for 21% of the total tanker sales. On dry S&P activity, the total volume of transactions reduced compared to 2021’s sales to 712 (28% down). The Supramax/Ultramax size has noted the greatest drop of sales compared to the same period of 2021 (34% down), whilst the Handymax was the only segment that noted an increase (32% up) but it’s not a significant move as the handymax number that change hands was a few.

But let’s see how active the Greeks were during 2022. Greeks bought about 130 Bulk Carriers, significantly fewer vessels than the 245 bulkers of 2021 but on the Tanker market about 100 product and crude vessels went to Greek owners, almost 13% more vessels than 2021. Handysize, Supramax/Ultramax and Pmax/Kamsarmax sizes had the lions share on the Greeks preferences as each of the size had almost 28% of the total dry bulker sales to Greek owners. On the other hand, MR2s had definitely caught Greeks interest with their share at around 33% of the sales, with MR1 and Aframax at the second and third place with 17% and 14% respectively.

For another year there is a significant surge of sale and purchase activity in the bulk and tanker secondhand market. As the uncertainty about the future fuel of the vessels and about the technologies for lesser emissions keeps strong, investors will hesitate to put new orders as they may be unable to operate efficiently in the near future and turn their attention to existing vessels. The booming of the tanker market which was helped by the Russian invasion of Ukraine and the sanctions towards Russian oil and gas was the main reason that tanker secondhand market bloomed during 2022. On the other hand the dry SNP activity was reduced comparing to 2021 but the more than 700 transactions that took place in 2022 is the second best performance since 1995. The liquidity and substantial cashflows generated during this past year with the expectation that China’s reopening from COVID restrictions will boost dry market, kept SnP transactions alive. Despite the uncertainties in the global economies, the war in Ukraine and the persistence of China in strick COVID policies, the demand for commodities & products is almost at similar levels as of 2021 & the market predictions for a sustainable, if not improved 2023, are boosting the sentiment. The world seaborne Iron Ore trade has almost the same tonne-miles as 2021 and about 5% more than 2019, the world seaborne coal trade volumes are higher than 2021 with almost the same tonne-miles and the global oil demand in 2022 was only 1% lesser than pre pandemic levels and 2% higher than 2021 while the outlook for 2023 for all the three commodities is positive.

Sale and Purchase:

Although the dry S&P activity was quiet during the past week, a significant number of vessels called for offers, mainly in the Capesize and the Supramax sector. Clients of Brave Maritime acquired the BWTS fitted Capesize “Lowlands Sunrise” - 181K/2011 Koyo for USD 26mills, while clients of GMS rumored to acquire the BWTS fitted “Wisdom Of The Sea 2” - 180K/2011 Daehan and the BWTS fitted “Wisdom Of The Sea 1” - 180K/2011 Daehan for high USD 23 mills each. Furthermore, on the same sector, the BWTS & Scrubber fitted “Amity”- 180K/2009 Dalian invited offers and hearing best seen was USD 18 mills. On the Supramax sector, the BWTS fitted “Pan Begonia” - 57K/2009 STX was sold for USD 12.5 mills, while the 2-year younger BWTS fitted “Royal Fairness”- 56K/2011 Mitsui invited offers and she is under negotiations in the region of USD 16’s mills.

The wet S&P activity was slower than in previous weeks but still at very robust levels. On the VLCC sector, the BWTS & Scrubber fitted “Cosmo Ace” - 320K/2010 HHI found new owners for USD 55 mills. The LR2 “Minoansea” - 108K/2008 SWS was sold for region USD 40 mills to clients of Garsea Shipping. 4x Ice Class 1A, BWTS & Scrubber fitted LR2 vessels, the “Delta Captain” - 111K/2005 Hyundai Samho, the “Delta Victory” - 111K/2005 Hyundai Samho, the “Delta Sailor” - 111K/2005 Hyundai Samho and the “Delta Pioneer” - 111K/2004 Hyundai Samho changed hands for USD 35 mills each. The BWTS & Scrubber fitted MR2 “Gwn 3” - 50K/2021 Samsung invited offers and has now been sold for USD 50 mills Japanese buyers. Last but not least, Thai buyers acquired the BWTS fitted Chemical “YC Dahlia” - 11K/2010 Nokbong for USD 11.2 mills.

Xclusiv Shipbrokers Inc.