Short period (3-5 months) and two-laden-leg fixtures have dried up in the Atlantic dry bulk markets, as shipowners seek to minimize risk ahead of the January 1 implementation date of the IMO 2020 sulfur regulations.
According to shipbroker sources, owners are reluctant to fix dry bulk ships on time charter for less than one year, or for two-laden legs trips that require redelivery close to the new year.
“It’s almost impossible to get owners to consider two-three laden legs right now, as they are afraid to get their vessels back in Q1,” said one shipbroker source. “[Shipowners] are so uncertain with the new regulations in 2020.”
However, some shipowners disputed this reluctance as an oversimplification, while conceding that Q1 weighs on owners’ minds.
Two dry bulk shipowner sources confirmed a preference for longer period fixtures (one year), to avoid the “double whammy” of IMO 2020 and uncertain Q1 rates.
“Q1 is terra incognita with 2020 coming up,” said one shipowner source. “Between the IMO regulations, the [US-China] trade war, uncertainty in the Middle East, and environmental problems, next year is a real hard poker game.”
Source: S&P Global Platts