Capesize secondhand sales bonanza in Q4

The Capesize market in Q4 thus far was defined by a steady decline in BDI with a recent small uptick during December. After its 5TC average peaked in the first days of October to US$33.500/d, it is now hovering in the very low US$15,000’s/d region. Substantial sales volume was recorded amidst a steady supply of tonnage available for sale, feeding the enhanced appetite for secondhand Cape investments during the first half of Q4. The mix of low orderbook to fleet ratio (8% for Capes with 28mill dwt in September 2020, compared with 14% on the average during 2017-2019), “capped” NB contracting. This is primarily attributed to market, regulatory and technological uncertainties (Capesize/Newcastlemax/VLOCS newbuilding orders number just 10 units for 2020 till October). It is this environment that signaled the resilience the dry bulk market has exhibited during the 2H20, amid various trade and logistical disruptions caused by the black swan “moment’’ (albeit a long and protracted one) of the ongoing pandemic.