Toepfer: MPP rates climbing as vessel availability tightens

Toepfer: MPP rates climbing as vessel availability tightens

Time charter rates for MPP vessels of all sizes have continued to climb as the availability of tonnage for charter is extremely tight, Toepfer Transport said in its quarterly multipurpose shipping report. 

The current market environment means the overall fixture activity is pretty low and that many of the few charter fixtures are for forward positions with delivery in six to twelve months and with long durations. One of the implications of these forward fixtures is, that some charterers do not know yet, that they already have lost access to parts of their fleet prior to being able to even discuss an extension of the charter.

“There are many early birds out there but not all of them will be able to catch one of the very few worms,” Toepfer analysts say in the report.

MPP newbuilding prices plateau

The newbuilding prices have reached a high level plateau. The available slots for MPP units are almost gone and there are only limited opportunities to place orders for MPP tonnage.

Most of the remaining slots are for deliveries in 2024 or later and the very few opportunities for 2023 delivery require quick decision making and well established negotiation channels.

Out of the market players, AAL have announced their long-expected order of four (plus two optional) large liner MPPs at Huangpu Wenchong. The SDARI-designed 32,000 dwt, 179 metres long and 30 metres wide ships have a bridge forward design and offer a huge unobstructed deck space. Besides state-of-the-art MPP capabilities and up to 700-ton combined lifting capacity the vessel have a remarkable TEU intake in excess of 2000 TEU.

UHL has taken delivery of UHL Fighter, the penultimate ship of their leased Ecolift F900-type newbuilding program. The 17th and final vessel of this series, UHL Felicity is scheduled for delivery in March 2022.

Sale and purchase demand high

There is high demand in the sale and purchase  market but the high income of the vessels make owners reluctant to offer vessels for sale, Toepfer report reads.

Furthermore it is difficult for owner to find suitable replacements in both the second hand and the newbuilding market. The amount of transactions has therefore declined except for some deals by plain asset players which cash-in on the increased asset values. Toepfer transport, however, expects that the activity in the sale and purchase market will calm down in the next months.

Author: Adnan Bajic

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