Bulk Carriers Orders Down 30%
The number of Bulker orders were down 30% for 2020 YTD compared to the same period last year. From the 1st of January 2020 when the Chinese market and shipyards closed due to the pandemic, until today, we have only seen USD 1,037 mil spend in the Bulker NB market, down 35% for the same period in 2019. The Chinese government have now started up the economy again and most of the orders placed are by companies like China Development bank and Bank of Communications all being built at Chinese yards.
COVID-19 has hit the Bulker market hard and values have taken a substantial tumble since the begin-ning of the year. This is mainly due to the softening in earnings we have seen since the beginning of the year. Earlier in February/March, we saw the Capesize and Panamax market falling dramatically, this has now caught up to the smaller sizes with the biggest fall in values seen in the older Supramax and Handysize vessels. From the beginning of the year until now, Capesize rates fell by c.80% and smaller Bulker sizes only by 60 -70%.
The number of deals transacted also fell by 40% compared to YTD 2019 with only 4 deals confirmed in the month of April 2020. Having said this, the number of deals in May 2020 showed signs the market is beginning to pick back up, with a high proportion of Greek companies taking advantage of low ship prices and buying when the markets down.
Although the Sub Continent steel plate price fell from USD 410/LDT to USD 295/LDT between the months of January and May, we have seen an increase on demolition deals done by c.40% YTD com-pared to YTD 2019 due to the poor market.