Fairplay: Let The Crystal Ball Give You Answers

“Fairplay reported on the dilemma facing shipowners: “paying up immediately in the second-hand markets for tonnage readily available” or “plac[ing] orders for capacity, which will earn revenues in 2009 and 2010.” The Fairplay article referred to Poten’s weekly opinion ‘Priced to Sell’ in which Poten “cautioned that ‘the ability of freight rates to support an investment in excess of $130M, in a newbuilding VLCC for 2009 delivery, may pose significant financial risk to owners that are taking a position in the newbuilding market today.’ The New York-based broker adds: ‘Even at $130M per vessel, demand for ship slots remains firm.’ It goes on to cite the surge in bulker orders crowding out tanker building capacity. Yet, for actual transactions, all eyes are still on dry, even as its ascent has stalled.”