October dry bulk newbuild ship prices are relatively consistent

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Newbuild vessel prices

An indicator to gauge bulk vessels’ fundamental prospects, ship prices include newbuild vessel prices and second-hand vessel prices. While newbuilds are more applicable to the long-term outlook due to the longer construction period, second-hand vessels help to analyze shorter-term, nearer-term fundamentals.

Newbuild vessels

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Stagnant newbuild prices

For bulk carriers, Capesize vessel prices stood at $96.5 million compared to $97 million in September. Kamsarmax and Ultramax vessel prices recorded $29 million and $27 million, respectively, compared to ~$29 million and ~$27 million in the previous month.

The total dry bulk fleet grew 4.9% year-over-year to 746.4 million DWT (deadweight tons), with Capesize vessels recording 4.9% growth and Panamax or Kamsarmax vessels recording 6.3%. Post-Panamax vessels recorded 6.4%. Handymax or Supramax vessels grew 4.8%. Year-to-date deliveries in 2014 stood at 37.2 million DWT.

October newbuilding activity

New orders activity remained weak in October, as we can infer from a falling orderbook for the month. For the longer run, a slowdown in newbuilding activity may have an impact on the Guggenheim Shipping ETF (SEA) and the performance of dry bulk shipping companies like DryShips Inc. (DRYS), Diana Shipping Inc. (DSX), Navios Maritime Partners LP (NMM), Navios Maritime Holdings Inc. (NM), and Safe Bulkers Inc. (SB).

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