Monday was a rough day all around on Wall Street but particularly painful for owners of ocean shipping stocks, which fell much more sharply than the broader market. Concerns over China’s economy, oil demand, Fed tightening and inflation added up to one of the worst trading sessions of the year for shipping names. From tankers to dry bulk to containers, double-digit plunges were widespread.
Container shipping shares
Chart: SONAR (To learn more about SONAR,click here.)
Crude tanker stocks
Clarksons Platou Securities assessed Monday’s spot rate for modern very large crude carriers (VLCCs; tankers that carry 2 million barrels of crude) at just $8,500 per day — less than a third of the Clarksons’ estimated breakeven rate for a five-year-old VLCC of $33,000 per day.
Crude tanker stocks saw gains earlier this year despite rate weakness, driven by optimism on a future recovery. With Monday’s slide, however, most crude tanker names have given up much (and in some cases all) of their YTD gains. VLCC owner DHT is now down 3% YTD.
Product tanker stocks
Clarksons put spot rates for modern LR2 tankers — which are around half the size of VLCCs — at $65,000 per day as of Monday, over seven times VLCC earnings.
YTD gains for product tanker equities remain very high: Scorpio is up 87% since the beginning of the year, Ardmore 77%.
To put that in perspective, the Dow Jones Transportation Average is down 10% YTD, the Dow Jones Industrial Average 11%, the S&P 500 16% and the Nasdaq Composite Index 22%.
LNG shipping shares
Dry bulk stocks
Dry bulk spot shipping rates are rising. According to Clarksons, spot rates for Panamaxes (bulkers with capacity of 65,000-99,999 deadweight tons or DWT) were $28,600 per day as of Monday. Rates for Supramaxes (60,000-64,999 DWT) were $30,000 per day. Panamax and Supramax are at decade highs for this time of year. Rates for larger bulkers known as Capesizes (180,000 DWT) have lagged YTD but jumped 17% on Monday to $26,400 per day.
