Blurred lines of MPP optimism
The expectations of a surge in cargo space demand towards the end of the year seem to be subsiding, smudging the optimism felt in the MPP sector previously. However, while the current low activity pushed the Toepfer Transport’s Multipurpose Index down for the fifth month on the trot, there is a bright spot to be seen some 12 months down the road.
The Hamburg-based shipbroker showed in its latest monthly review that the index dropped to $12,208 per day for the month of November 2023. In terms of percentage, the drop was quite similar to that of the previous month, namely 2.9 per cent. As a reminder, the index was at $12,958 per day in October.
Compared to November 2022, Toepfer Transport’s TMI slid down 35.5 per cent.
However, looking six months ahead, Toepfer Transport expects the index rates to go back up some 3.1 per cent while this time next year the TMI is expected to be 7.2 per cent higher.
“The delay of various projects and the non-appearance of the well-expected surge in demand for cargo space from the wind power sector as well as the low activity in the minor bulk markets have blurred the optimism,” Toepfer Transports’ research department said. “The TMI-P indicates that the outlook for the market is more positive than it was in the past months. The increase of newbuilding ordering activity and the time charter rates agreed for these newly ordered ships indicate quite some positive sentiment in the long term.”
Newbuilding prices for 9,000 dwt, 12,500 dwt and 30,000 dwt newbuilds, according to Toepfer Transport, were at $20, $30.5 and $51 million, without any change for the last few months. Prices on the second-hand market have shifted downwards a bit landing at $10.75, $15 and $18.75 million for the 9,000 dwt, 12,500 dwt and 30,000 dwt vessels, respectively. This is a $250,000 drop in prices across the board.