Dec 12 | 2019
Charter Rates Slide to US$7,554
Rates for time charter of multipurpose vessels have fallen slightly for the last month of the decade, according to research from shipping consultancy Toepfer Transport.
The latest update of the firm’s Multipurpose Shipping Report index suggests that the average six- to 12-month time charter rate declined to US$7,554 per day in December. This compares with a rate of US$7,578 per day reported in early November.
“With the input from renown owners, operators and charterers, we have been able to establish the first independent MPP Index in the Market,” a spokesperson for Toepfer said.
Fourth highest monthly rate
Despite the slowdown in demand the monthly figure was the fourth highest monthly rate in 2019, indicating the torpid state of the market at present. Yorck Niclas Prehm, head of research with the German consultancy, previously predicted that activity was likely to stagnate until at least March 2020 as uncertainty weighs on project investment.
Growth in demand for liquefied natural gas, is forecast to boost project cargo demand next year with new export facilities coming online and increased investment in brownfield sites.
Toepfer data suggests that charter rates have remained flat since the latter half of 2018, closely aligned with a global slowdown tied to trade tariffs and policy uncertainty.
Oversupply
Headquartered in Hamburg, Germany, Toepfer Transport is one of the largest S&P brokers in the city and alongside core S&P brokerage services provides newbuilding consultancy and market research.
“Newbuildings play a vital role within our regular scope of work, giving us quick and direct access to yards and design companies,” the firm said in a statement.
Given this outlook, the firm notes that a slowdown in second-hand sales of multipurpose ships is also hit margins as oversupply is depressing rates and market pressure continues to make bank financing challenging.
The latest update of the firm’s Multipurpose Shipping Report index suggests that the average six- to 12-month time charter rate declined to US$7,554 per day in December. This compares with a rate of US$7,578 per day reported in early November.
“With the input from renown owners, operators and charterers, we have been able to establish the first independent MPP Index in the Market,” a spokesperson for Toepfer said.
Fourth highest monthly rate
Despite the slowdown in demand the monthly figure was the fourth highest monthly rate in 2019, indicating the torpid state of the market at present. Yorck Niclas Prehm, head of research with the German consultancy, previously predicted that activity was likely to stagnate until at least March 2020 as uncertainty weighs on project investment.
Growth in demand for liquefied natural gas, is forecast to boost project cargo demand next year with new export facilities coming online and increased investment in brownfield sites.
Toepfer data suggests that charter rates have remained flat since the latter half of 2018, closely aligned with a global slowdown tied to trade tariffs and policy uncertainty.
Oversupply
Headquartered in Hamburg, Germany, Toepfer Transport is one of the largest S&P brokers in the city and alongside core S&P brokerage services provides newbuilding consultancy and market research.
“Newbuildings play a vital role within our regular scope of work, giving us quick and direct access to yards and design companies,” the firm said in a statement.
Given this outlook, the firm notes that a slowdown in second-hand sales of multipurpose ships is also hit margins as oversupply is depressing rates and market pressure continues to make bank financing challenging.
