A Matter of Perspective
Amidst widespread price increases, it is not surprising that tanker asset values have also been rising. Our data shows a strong appreciation in VLCC and Suezmax values, with a significant divergence between newbuild and second hand price increases. Even more interesting is the difference in growth rates between newbuilds and 5 year old vessels and older 10 and 15 year old tonnage. Gibson asset value data shows newbuild VLCC and Suezmax values both increased by 5% respectively YTD, whilst over the last 12 months they increased by 17% and 13%. This has been driven by rising raw material costs, shrinking yard availability and relative pricing of other vessel types such as container carriers. Although, these increases have likely been capped by a lack of actual ordering given the difficulty in securing both yard slots and design hesitation. With overall producer price inflation averaging approximately 8-10% across most advanced economies, newbuild prices have also felt the pressure but the rate of increases this year may be slowing compared to gains we saw in the second half of 2021.
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The opinions expressed herein are the author's and not necessarily those of The Xinde Marine News.
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