Wednesday, November 12, 2008
Norden reconsiders bulk carrier newbuildings
by Michelle Wiese Bockmann - Wednesday 12 November 2008
Norden's website shows a long list of dry bulk newbuildings on order, at shipyards in both China and Japan.
NORDEN has joined the expanding list of dry bulk owners and operators prepared to reconsider its massive list of newbuildings on order.
The Danish dry bulk giant said it had 35 bulk carriers ordered, but has indicated it is willing to talk to shipyards about changing contract terms, including delivery delays or cancellations.
“I will put it this way,” Norden senior vice-president Martin Badsted told Lloyd’s List. “Norden is a reliable company and we will stick by our contracts. You won’t see us cancel contracts, where we just walk away.
“But of course, if there’s anything to be negotiated with some of the yards, where both parties can actually see any benefits to changing some of the contract terms... we will be open to entering into discussions. But otherwise, we will want to be a reliable partner to our counterparties.”
Contract terms could include later delivery or not going ahead with an order, “as long as both parties agreed to it”, Mr Badsted said.
He confirmed that time charters had not been secured against any of the vessels on order, but refund guarantees had been secured, and deposits paid.
Norden’s website lists an even longer list of dry bulk newbuildings on order, at shipyards in both China and Japan, including 32 handysize, 31 handymax, five panamax and 12 post-panamax vessels.
Norden owns about 10% of its dry bulk fleet, and last week sold two panamaxes and one handymax vessel because “it was prudent to take some cash off the table”.
The company joins other public shipping companies, such as Eagle Bulk Shipping, Golden Ocean Group and Excel Maritime Carriers, which have either indicated that their newbuilding programme is under consideration, or have had informed market sources suggesting that it is so.
These cancellations are believed to be the tip of the iceberg, as the swollen bulk carrier orderbook begins to deflate as many privately held companies walk away, amid deteriorating market conditions.
Leading London-based capesize broker Arrow has completed research that reveals that more than 58 capesize newbuildings were cancelled in the first nine months of this year. A further four post-panamax, 42 panamax and 50 smaller bulkers have also been cancelled, the broker confirmed.
That figure is now viewed as conservative, with further cancellations recorded over the six weeks since the report was compiled, the brokerage said.
As much as 20% of the global fleet of around 7,000 bulk carriers is reported to be idle or without employment, as the global recession and credit squeeze combines to restrict cargo shipments, especially for key commodities such as iron ore.
As adapted from Lloyds List
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