Saturday, January 03, 2009
Sector Snap: Drybulk shippers rise on stable steel
Friday January 2, 11:53 am ET
Drybulk shipping stocks jump as activity blips up for largest vessels, steel prices stabilize
NEW YORK (AP) -- Shares of drybulk shippers accelerated Friday as activity for the sector's largest vessels rose slightly and prices for steel -- a major commodity they haul -- stabilized.
Rates for Capesize vessels rose 1.2 percent to $8,997 per day on Friday, according to Dahlman Rose analyst Omar Notka. Capesize vessels are so named because they are too big to fit through the Panama or Suez Canals and must instead navigate around the Cape of Good Hope or Cape Horn to travel between oceans.
Other vessel classes lost ground. All drybulk vessel rates have plunged in recent months as commodity demand fell off, prices of iron ore, coal and grain sank and tight credit froze shipping markets. Just one year ago, the daily rate for a Capesize vessel was $153,295.
Notka said that although rates remain very low and a surplus of idle ships threatens to keep rates low for some time, stability in steel prices has managed somewhat to buoy the market.
In midday trading, Diana Shipping Inc. shares jumped $1.30, or 10 percent, to $14.06. DryShips Inc. rose $1.97, or 18 percent, to $12.63. Genco Shipping & Trading Ltd. gained $2.24, or 15 percent, to $17.04.
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