Betting on Dry Bulk: Newbuild Market Stands Strong in Q3

In its Q3 Dry Bulk report, Maritime Strategies International (MSI) estimates dry bulk newbuilding orders in the first eight months of the year above 25m dwt, with the potential for further upside on the back of late-reported deals. Despite a slight August lull, second-hand bulker values remain firm.

MSI expects more than 30m dwt of dry bulk capacity to be delivered in 2024, with the orderbook forecast to rise still further by the end of the year, driven by strong contracting activity seen so far, with 2024 totals expected to hit 34m dwt.

A notable feature of newbuild contracting activity in recent months is the ongoing interest in Capesize vessels. A total of 4.4m dwt of Capesize capacity was ordered during Q2, up by a third on Q1 levels and the highest quarterly total since Q2 2021. By contrast, the relative lack of interest in new Handysize vessels has persisted, with Q2 orders just 0.16m dwt.

In the second-hand market, demand for dry bulk ships remains robust, with MSI’s assessment of five year-old Capesize prices staying above $60m, a level not seen in almost 15 years. Prices for older ships are close to their 2022 peaks, with even 18 year-old Capesizes selling for over $20m.
Prices for younger vessels are even stronger, supported by rising newbuild markets. Year-to-date transaction volumes are nearly 25% higher than the same period in 2023.