Charter rates have bottomed out
The charter rates for multipurpose vessels have bottomed out. Toepfer’s Multipurpose Shipping Index for July shows the rates bouncing back a notch to 6,391 dollars per day for a 12,500 dwt geared vessel.
The average rate of July shows a slight improvement in comparison to June when the average day rate was 10 dollars lower.
The day rates for multipurpose vessels have dropped significantly since the coronavirus broke out. In February, the average charter rates amounted to 7,415 dollars, which means rates have dropped by 14% since then.
The coronavirus does not only have an adverse effect on demand but also limits shipping companies’ options to sell vessels, as Wagenborg recently stated in its annual report.
Shipowners are not all affected the same by the pandemic as some of them are less exposed to the spot market or have an asset-light strategy. However, all shipowners PCJ recently spoke do agree on one thing: it is completely uncertain how this situation will develop.