Weak perspectives for the dry bulk market in 2011

The dry bulk market experiences a “long & painful” period of weak freight rates and if owners fail to cut the size of the existing fleet the market will not revive, warns shipbrokering firm Barry Rogliano Salles (BRS).

It urges owners to take advantage of attractive scrapping prices to recycle ageing tonnage at the earliest opportunity. BRS notes that the decline in freight rates during the fourth quarter of 2010 created a noticeable slow-down in secondhand-market activity. BRS predicts a correction in prices over the coming months.

In 2011 a massive 250 standard capesizes are scheduled to be delivered, which to be absorbed will need a significant growth in demand.  As far as panamaxes are concerned the combination of cancelled orders, demolitions and growing demand could keep shipowner revenues at acceptable levels.
Last year, no fewer than 50 panamaxes out of 220 originally scheduled for delivery were cancelled. But in 2011 about 280 panamaxes are for delivery, 18% of the existing fleet.

Full article, ELNAVI magazine, Issue 449-May 2011, Page. 8

Read also this article in : Greek

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