Toepfer Transport: more obstacles in the MPP sector than anticipated

Toepfer Transport: more obstacles in the MPP sector than anticipated

Illustration only Core Shipping

Multipurpose (MPP) sector is facing more challenges from the anticipated demand from the renewables sector than it was previously expected. The slip in optimism has also been reflected in the Toepfer Transport’s Multipurpose Index that dipped again, ninth month in a row. 

The Hamburg-based consultancy and shipbroker noted that the time charter rate assessment for the month of April landed at $14,595 per day, 2.09 per cent down from the previous month. Toepfer Transport expects the rates over the following six months, to edge up 0.7 per cent. For the following twelve months, the shipbroker foresees an index slip of 0.42 per cent.

Compared to April 2022, when TMI stood at $22,764/day, April 2023 figures are 35.89 per cent down.

Toepfer Transport: more obstacles in the MPP sector than anticipated
Courtesy of Toepfer Transport

Commenting on the current market, Toepfer Transport’s analysts note that there are a few more obstacles for the anticipated demand from the renewables sector to phase in, than in was expected by the MPP market players.

“This is underlined by spot positions re-appearing on the carriers’ sailing lists after many months of extraordinarily good utilisation of the tonnage,” the latest analysis reads.

“While in good times we like to rely on our short term memory only, we are forced to remember that, historically, in the mid- and long-term imbalances between trade areas are normal and so are spot positions from time to time,” the analysts says.

On the asset side, the second hand market only shows slow movements at low activity while the newbuilding prices move upwards due to rising costs as well as increasing interest rates for the shipyards.

Toepfer Transport also noted that the prices for 9,000 dwt,12,500 dwt and 30,000 dwt newbuilds moved upwards due to the rising costs and increasing interest rates for the shipyards. Activity in the second hand market was subdued.

Newbuild vessel prices were $19 million, $30 million and $49 million across the board while second hand market prices stayed at $11.25 million, $16.00 million and $20.5 million, respectively. The only difference to the previous month was the slight downwards shift in the price of 12,500 dwt second hand vessels, from $16.25 million.

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Author: Adnan Bajic

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Toepfer Transport: more obstacles in the MPP sector than anticipated | Project Cargo Journal