Pacific Basin outperforms market in Q3
Pacific Basin continued to do well in the troubled dry bulk market. Its third quarter trading update showing that as at 15 October, 93% of 39,060 contracted handysize revenue days in 2012 were covered at $10,820 per day net, much better than the average handysize spot market rates of $7,600 per day net in the year to date, Seatrade Asia online reports.
However, Pacific Basin added that a weak spot market in the third quarter and a continued weak rates outlook for the rest of the year will reduce the possible earnings for the remaining unfixed vessels in 2012.
The major small bulker player also went back into the S&P market for the first time since last October, taking delivery of one second hand Japanese-built handysize ship during the quarter, "We are actively looking at more ship buying opportunities to expand our core fleet of owned vessels at attractive prices," Pacific Basin said in a press release.
The other core division, PB Towage, also did well, with Australian oil and gas activity continuing to buoy results, with robust demand for marine construction support driving strong utilisation of its fleet.
PB Towage's core fleet of offshore tugs and barges have employment cover through 2013. "In the short to medium term, we expect to continue to benefit from healthy demand in Australia and other markets as a number of key offshore projects commence construction work and others enter their Front-End Engineering Design phase," the company said.
Looking ahead, Pacific Basin said that despite an expected slow-down in newbuilding deliveries, weaker economic conditions and generally softer growth in Chinese demand for commodities are expected to limit seasonal recovery in dry bulk freight rates in the remainder of the year. "Average handysize spot market earnings in the first nine months of the year were $7,600 per day net, as compared to $15,600 and $10,025 in 2010 and 2011 respectively, pointing to another year of decline in full-year average market freight rates," it said.
Pacific Basin said it is still looking to buy more ships. "The protracted dry bulk market weakness and funding shortages continue to drive down vessel prices to levels that make acquisitions increasingly attractive to well-capitalised owners like us, and we are actively evaluating opportunities to buy secondhand ships that are suitable to our requirements."
