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There was some positive news last week. Suezmax rates rose sharply on increased activity. But it is expected that VLCC vessels can quickly “steal” much of the increased activity and still put pressure on rates. The Aframax segment remains fairly stable. We are also seeing an increased flow of Canadian oil to the east as a result of OPEC cuts and the absence of volume from, among others, Venezuela. Furthermore, we expect that the low spot rates will trigger increased activity in the scrapping market. The price of steel has risen sharply in recent months, which has brought scrap prices up from about $275 per ton. back in July to over $500 per. ton last week.

Aframax – 12 month TC: $15,250 pr. day
Aframax – Average spot market rate: $5,301 pr. day

Dry Bulk:

The dry bulk rates continue to increase. Coal is the major driving force in the market today as China has greatly increased its coal imports due to cold weather and minor restrictions. We are approaching the Chinese New Year, which will normally dampen activity in the dry bulk market, but industry analysts are unsure whether it will occur this year. Solid stimulus packages from the Chinese authorities to keep the economic activity going can lead to the activity actually remaining fairly stable during the holidays.

Capesize 12 month TC: $19,500
Kamsarmax 12 month TC: $15,125



Last week, DHT completed the acquisition of two VLCC ships built in 2016 for $68m each. Guideline values for five-year VLCC ships at the time of writing are $65m. This testifies to a secondary market that may soon be heading into an upward trend. More stakeholders are looking for tonnage at favorable prices in order to position themselves ahead of the expected rebound in the tanker market.

Dry Bulk:

In dry bulk, we see that activity is strong, especially in the capesize segment. At the end of the week, two transactions were completed for two smaller Kamsarmaxs (2006 & 2009) at $8m and $13.2m, respectively. There is no doubt that there is a positive development in dry bulk during the day.