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Despite increasing prices, the orderbook for the four main vessel categories continues to grow

Despite increasing prices, the orderbook for the four main vessel categories (bulk carriers, tankers, containers & gas carriers above 10,000 DWT) continues to grow, mainly driven by the strong cashflows of owners and the need for fleet renewal. Even in the container sector, the recent surge in freight rates has driven many companies and owners to restart their fleet renewal programs and place new orders with shipyards. Notably, some of the new orders (about 3%) are scheduled for delivery as late as 2028 or even the first few months of 2030 (gas orderbook). This represents a significant increase compared to two years ago, when only 17 ships (or 0.7%) in the orderbook had delivery dates beyond four years from that point.

As of early June 2024, the orderbook-to-fleet ratio (in DWT/TEU/CBM terms) for bulk carriers, tankers, containers, and gas carriers stood at 9.3%, 10%, 20.3%, and 47.7%, respectively. This represents a significant increase compared to the previous year. Looking back one year, the corresponding orderbook-to-fleet ratios were 7.1%, 4.6%, 27.9%, and 41.8%, while at the same period in 2022, the ratios were 6.5%, 5.8%, 27%, and 32.2%. The orderbook-to-fleet ratio for bulk carriers, tankers, and gas carriers has grown by 43%, 72%, and 48% respectively over the past two years. On the other hand, the container orderbook, affected by low freight rates that dominated the market in the past two years, saw its orderbook-to-fleet ratio decline by 25%. The rebound in freight rates after the COVID period has significantly boosted the global shipbuilding industry, following a challenging period. In June 2022, there were 153 active shipyards. This number rose to 160 by June 2023, and further climbed to 180 by June 2024, representing a 17.7% increase over two years. As expected, shipyards specializing in bulk carrier and tanker construction have witnessed the most significant growth. The number of active bulker builders has increased from 80 in June 2022 to 88 in 2023 and finally to 106 in 2024. Similarly, the tanker orderbook shows a significant rise, with active yards jumping from 60 in 2022 to 78 in 2024, representing a 30% increase. Chinese shipyards have been the primary beneficiaries of this growth, experiencing a remarkable 37% increase in active yards within two years. In 2022, there were 83 active Chinese shipyards; this number rose to 92 in 2023 and reached 113 by June 2024. In contrast, the number of active shipyards in Japan and South Korea has remained relatively stable over the past two years.

There is a substantial increase in the number of companies investing in the newbuilding market over the past two years. To be more precise, back in May 2022, the total order book was distributed among 381 different companies based in 43 countries. Within the last 2 years, the number of companies investing in the newbuilding market has increased by around 35%, reaching to 512 in early June 2024 across to 46 countries. Greece and China led the surge in companies entering the newbuilding market, with a 20% and 18% rise, respectively during the last 24 months. As of May 2022, 60 Greek shipping companies had vessels on order. This number has grown significantly, with 72 Greek companies currently active in the newbuilding market. Chinese shipping companies have also seen considerable expansion. In May 2022, 130 Chinese companies were invested in the newbuilding market for the four main sectors. This number has grown by 18%, with 153 companies currently active. Interestingly, as of the June 2024 orderbook, the Greek "big names" have a significant presence in the Greek orderbook. Specifically, 20 out of 72 Greek companies (28%) have placed 384 out of the total 531 orders (72%).

S&P activity:

Dry:

Large sizes remain popular among Greek shipowners. On the Newcastlemax sector the "Mineral Charlie" - 205K/2012 HHIC and "Mineral Maureen" - 205K/2012 HHIC were sold for USD 81.6 mills enbloc to Greek buyers. Greek buyers acquired also the Capesize "Courageous"- 181K/2016 SWS for USD 50.5 mills, while also seem to be behind from the sale of "Stella Hope" - 180K/2016 Dalian which was sold for USD 49.5 mills. Moving down the sizes the Kamsarmax "Livia Rose" - 82K/2018 Tsuneishi Zhoushan was sold for USD 35.6 mills to clients of HMM. On the Supramax sector, the "Maine Dream" - 58K/2012 Tsuneishi Cebu found new owners for USD 19.3 mills. Last but not least, the Handysize "Gold Dust" - 28K/2012 Imabari was sold for USD12 mills to Vietnamese buyers.

Tanker:

The tanker S&P activity was low this week, with only 4 sales to report. On the VLCC sector, Greek buyers acquired the Scrubber fitted "C. Prosperity" - 314K/2009 HHI for USD 53.5 mills. The Scrubber fitted Suezmax "Front Thor" - 157K/2010 Jiangsu Rongsheng changed hands for excess USD 48 mills. Finally, on the MR2 sector, the "Avon" - 50K/2019 HMD found new owners for USD 45.5 mills basis TC attached at USD 23.5k/day for 5 years.

Xclusiv Shipbrokers Inc.