EXTRACTED FROM SOURCE LINK:
http://www.hellenicshippingnews.com/newb...-business/
"In what could prove as a great bargaining opportunity for many ship owners, there seems to be a solid trend towards lower newbuilding prices, as shipbuilders are looking to attract more business. According to the latest weekly report from shipbroker Allied Shipbroking, “the softening price trend continues as the bulk of shipbuilders report sub par quarterly earnings. The difficulties having been noted during the course of the year has taken its toll on the majority of shipbuilders in all three major shipbuilding nations”.
Allied noted that “few are those which seemed to have escaped the poor operating performance and those few seemed to have used the opportunities that arose in the tanker market taking up their good reputation in the construction of product tankers to gain an upper hand during the current market downturn. The question here is that even these few shipbuilders will be finding it ever more difficult to avoid slipping into the red, as expectations regarding activity moving forward are for a continuation of what we had seen during the majority of 2015. The only escape seems to be through a continued consolidation in the shipbuilding market in order to better balance supply in accordance with the pre-vailing demand side of things”.
Meanwhile, in a separate weekly report, Clarkson Platou Hellas noted that “the focus of ordering this week has been in the coated/specialised tanker markets. COSCO Dalian announced an order for one firm 22,000dwt coated product tanker for delivery at the end of 2016. The buyer is understood to be Hong Kong based Heng Tong Fuels & Shipping. Although understood to have been signed earlier this year, it has come to light that ABC Maritime (Canada) have ordered three firm 21,800dwt IMO2 coated shallow draft chemical tankers at Triyards (Ho Chi Minh). Delivery of all three vessels is planned for 2H 2017.
In the ferry/ropax markets, Caledonian Maritime Assets Ltd (CMAL) have announced that contracts have been signed with Ferguson Marine in Scotland for two 100m ropax. Pricing is in the region GBP 48.5m each, with delivery planned for 1H 2018”, the shipbroker concluded.
In the S&P markets, Allied Shipbroking noted that “things seemed to have been under considerable pressure on the dry bulk market for the past several weeks, as the number of buyers with keen interest dried up, while in some size segments we also noted a strong number of good quality candidates flood the market under distressed sale conditions. Inevitably this should push for a continual drop in prices with further discounts now expected to be reflected in several upcoming sales. On the tanker side, activity picked up again this week with the emergence of a good number of enbloc deals. Through this however it also emerged that the market is now on a softening trend in terms of asset prices with some of the biggest drops now confirmed on the larger VLCCs which now look to have lost on their summer period momentum”.
Finally, in the demolition market, Allied noted “another drop in scrap prices noted this week though little of this is reflected by the few deals that emerged in the market as it seems as though it is only owners of larger more endowed vessels which are brave enough to take up the demo option under the current prevailing market conditions. Beyond the negative trends noted in terms of scrap prices, there has been a slow holding back of demo candidates, especially in the dry bulk market, as many feel that it is worth waiting for the next seasonal downturn to remove their tonnage rather than missing out on any final earnings they may accrue. This however is only truly an option for a few (notably those not faced with any class survey renewal costs) while even those few owners are playing a gamble between any hopeful gains from improved freight earnings and the prospect of facing even softer scrap prices. Especially as the market stands now with end buyers still facing difficulties, it looks as though any sudden influx in demo candidates would have the potential of plummeting the price of scrap to some of the lowest levels noted over the past 15 years”, the shipbroker concluded."