Dry bulk shipowners cutting back newbuild orders

Greek shipowners are holding back from dry bulk newbuilds - according to reports from Lloyd’s List.

It is the first time in more than a year, that no new bulk carriers were ordered, based on the March monthly newbuilding assessment carried out by Piraeus-based brokers George Moundreas.

Last December, 33 vessels worth $1.7bn were contracted, including 30 bulk carriers.

As of January 2008, just 11 ships worth $517m were ordered , 16 ships worth $1bn in February and a further 17 at $424m in March. This compared with the 54 ships worth $2.8bn ordered last November — the majority of them bulk carriers — during the height of the boom in dry bulk charter rates.

According to Moundreas there were three reasons for the slowdown in orders:

“Most shipyards with which Greek shipowners are familiar have no available slots for a reasonably early delivery,” Mr Banos said. “So they now propose late 2010, 2011 and even with some of them with more than one ship on order, even as late as 2012.

“Secondly there is a certain fear for the future of the market, especially fed by this sub-prime crisis in the US which has already extended in Europe these days.

“Thirdly is the price hike [for newbuildings] which has recently become quite sharp, because of the increase of costs of iron ore and consequently the shipbuilding steel price. There is also the scarcity of main engines. All those I think make newbuilding orders somewhat harder than it used to be in the recent past.”

Mr Banos said that it was very difficult to say whether the drop in orders was a short-term anomaly or indicated a longer-term trend. “I believe that behind the curtain there is still some interest and we as brokers have experienced quite a lot of interest,” Mr Banos said.

Bulk carrier newbuilding prices have continued to firm despite January’s market correction, which saw the average timecharter daily rate for capesize vessels plummet by more than half on rates seen during the mid-November peak.