According to the Baltic Exchange the 177,700-dwt Houston(built 2009) was fixed for 11 to 14 months at a rate of $20,000 per day but the identity of the new counterparty isn’t clear.
Earlier in the day modern capes were seeing a daily average of around $27,000 in the spot market but would likely command much less if taken on a one-year time charter, brokers say.
In a morning market briefing Omar Nokta of Global Hunter Securities pointed out that spot rates are approximately 5.1% higher than yesterday and 62.7% above levels seen seven days ago.
The Wall Street analyst attributed these gains to an uptick in fixture activity driven by a spike in Chinese iron ore imports and several bookings connected to cargoes destined for Europe.
While the rate achieved by Diana’s cape is far less than the premium paid for tonnage trading in the spot market, observers note it is identical to what the 179,100-dwt Navios Buena Ventura (built 2010) commanded in a deal with a similar duration minted earlier in the day.
The Houston made headlines last week when the Chinese charterer walked away from a fixture penned back in November 2009. As we reported, the contract carried a daily price tag of $55,000 and wasn’t due to expire until October of 2014 or even later had Shagang exercised options.
At the time, market veteran Justin Yagerman, an analyst at Deutsche Bank, told investors who track US-listed shares of Diana that he believed the “above market nature” of the contract was “a key motivator” behind the termination even though Shagang pointed the finger at the owner.
“Given the young age of the vessel, the well-above-market nature of the contract and the strong reputation of Diana, we have a hard time believing this is not just about the money for Shagang,” he told clients last week. “However, time and potentially courts will likely decide this case.”
The first dispute between Diana and Shagang over the Houston took shape in December 2011 when the Athens-based operator launched a campaign to claw back approximately $4.8m in overdue charter hire. A resolution was ultimately reached butfew details were made public.
Back then many industry observers accused the Chinese company of resorting to strong-arm tactics in an attempt to revise the terms of fixtures inked at the height of the market. Some, like Golden Ocean, agreed to slash rates to minimise the risk of losing contracts altogether.
More recently Shagang capturedinternational media attention when it arrested the 47,678-gt cruiseship Henna (built 1986), which left 1,600 passengers stranded off South Korea for two days, in response to a $58m charter row with HNA Group.
Attempts to reach Diana Shipping for comment about the Baltic Exchange’s report were not immediately successful at the time of posting Tuesday.
You read about all of the latest spot market fixtures in TradeWinds' daily dry-bulk chartering report by clicking HERE or on the links located under the Related section to the right of this article
