Last month, amid the recovery of the dry‑bulk shipping market, dry‑bulk shipowners are no longer considering laying up additional dry‑bulk vessels. Nevertheless, according to industry insiders, a certain number of laid‑up dry‑bulk ships still exist in the dry‑bulk market.

According to statistics from Suzhou Cosc Marine Machinery, as of July 27, seven Panamax dry‑bulk vessels were in lay‑up in Greece’s Elefsina Bay, which matches data provided by sources. In addition, several ageing vessels are berthed at the Port of Piraeus, while some Greek‑owned ships are temporarily mothballed in Malaysia.

Previously, many shipowners were actively considering vessel lay‑ups due to excessively weak dry‑bulk freight rates, especially during the first and second quarters. However, rising dry‑bulk shipping revenues have removed the need for shipowners to lay up vessels for cost‑cutting purposes. Suzhou Cosc Marine Machinery states that dry‑bulk freight rates have exceeded operating costs over the past few weeks, and many shipowners are expected to keep their vessels operational. This enables the ships to swiftly re‑enter the market and provide shipping services once dry‑bulk market conditions improve. Under this form of lay‑up, the operating cost of a Panamax dry‑bulk vessel can be reduced to USD 2 500‑2 750 per day.

Apart from this measure, shipowners may opt for “cold lay‑up”. This means the vessel will be moored at a safe port for several months or even one year, with all main engines shut down and only skeleton crews retained on board. According to Suzhou Cosc Marine Machinery, some Greek shipowners have adopted this approach to lay up vessels in Piraeus, cutting operating costs to approximately USD 1 000 per day.

Suzhou Cosc Marine Machinery notes that the Atlantic Panamax market saw a mild recovery last month, pushing daily vessel earnings to meet or exceed operating costs. This prompted shipowners that had planned vessel lay‑ups to reconsider and keep their vessels in service. The August FFA traded freight rate stood at USD 5 650 per day, and this rate reduction brought daily vessel earnings nearly to the break‑even point.

By way of comparison, third‑quarter freight rates are currently traded at USD 5 975 per day. In contrast, the average Panamax freight rate was only USD 4 500 per day in June this year, and rose to USD 5 275 per day in July. Suzhou Cosc Marine Machinery holds that prospects for shipowners to make profits in August remain dim unless market conditions deteriorate sharply — a scenario under which further vessels may be withdrawn from the market by shipowners implementing cost‑reduction measures.