Hellenic shipowners have proven the most active in scrapping older vessels during January, according to the latest weekly report by shipbrokers and consultants N. Cotzias Shipping Group.
In total during the first month of 2010, 87 ships of all types were scrapped, bearing an aggregate capacity of 3,659,775 Dwt, while their average age was 30.7 years old. Out of them, 18 were owned by Hellenic ship owners, which means that they accounted for almost 21% of the total, while Singaporean and Syrian owners came in 2nd place with 7 ships each (share of 8%).
What’s more interesting is that as Cotzias notes out, the ship demolition market is currently booming, with average prices going up. During January average prices by shipbreakers stood at $351 per liquefied ton, when during the previous months the numbers were closer to the low $300. At the moment though, there are offers even at $400 per ton, which provide for a hefty compensation to ship owners.
In total during January, 13 dry bulk carriers were sold for scrap (464,361 dwt), coupled by an additional and rather impressive 38 tankers (2,595,203 dwt) and 25 container ships.
The turn of the new Year saw a number of important factors that affected international shipping. First of all, after a positive start the Baltic Dry Index has kept a rather erratic pace, mostly falling to lows unseen for many months. At the same time, fears of an impending oversupply clout scared the market, while Chinese iron ore imports were lower than usual, with everyone’s hopes for a pick up in activity, lying with the end of the country’s festivities. As a result, with healthy scrap prices currently available, more owners are looking for opportunities in the demolition market.
Earlier in the month, researchers at Clarkson said that total scrapping activity is expected to more than double during 2010, surpassing the 60 million tons mark. During 2009, which also recorded one of the fastest pick up of demolition activity, a total of 29.88 million tons of vessels was scrapped.
Lower freight rates and a huge orderbook in most ship types across the industry led many ship owners to scrap their older vessels, in an effort to pave the way for their expected new buildings.
Based on Clarkson figures the 2009 scrapping figures were the highest in a decade as 246 dry bulk carriers were scrapped, together with 188 tankers and 180 container ships. Their average age stood at 29 years old. Just for comparison 2008 saw the scrapping of just 377 ships with a capacity of 13.2 million tons, with an average age of 30.5 years old, a bit higher than those scrapped last year. In fact, most of them leaving the world’s fleet during the last quarter of the year, when the economic crisis broke out, leaving the shipping industry stunned. Scrapping figures from other sources vary, but it seems that approximately 30-35 million tons of shipping capacity left the fleet last year.
According to shipbroker consultants N. Cotzias Ltd., 34.6 million tons of carrying capacity was removed from the market.
During the whole of 2009,
Average prices for the whole year were around the $270 per ton mark and that number includes the price offered by Turkey
Source: Macor Shipping. 17 February 2010
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