Pacific Basin will put fleet expansion plans on hold amid the ongoing market uncertainty caused by the coronavirus pandemic.
Pacific Basin said it would pursue Japanese-built second-hand bulkers, Suezmaxes in particular, while not ordering newbuilds.
Pacific Basin expects that the effects of COVID-19 containment measures and weak spot market rates will negatively affect its Q2 earnings.
Commenting on Q1 results, Pacific Basin said that its vessel earnings held up well despite a weak Chinese New Year period, including the negative effects that coronavirus containment measures have had.
Handysize and Supramax daily time-charter equivalent earnings averaged at USD 8,020 and USD 11,310 net per day in the first quarter, representing a 12% reduction and 9% increase respectively compared to the same period in 2019.
During the first quarter, the dry bulk owner took delivery of three secondhand vessels, one Handysize, and two Supramaxes, which were purchased in 2019. The company’s owned fleet currently stands at 117 vessels.
“Although we had a few logistical delays, our ships continued to trade largely as normal in the first quarter, partly due to the delayed impact of COVID-19 containment measures on the freight market, but also because we benefited from the relative resilience of global shipments of agricultural products, construction materials and other minor bulks. As a result, Handysize and Supramax rates were much higher than Capesize rates in the first quarter,” the company said.
Looking beyond the first quarter, Pacific Basin expects that the effects of COVID-19 containment measures and weak spot market rates will negatively affect its second-quarter earnings.