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Five Stars pays $70 mn for two dry bulk ships

Five Stars pays $70 mn for two dry bulk ships
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First Published: Mon, Apr 26 2010. 11 20 PM IST
Updated: Mon, Apr 26 2010. 11 20 PM IST
Bangalore: Mumbai-based Five Stars Bulk Carriers Pvt. Ltd has purchased two second-hand dry bulk ships for around $70 million (Rs310 crore), taking advantage of falling ship prices globally.
The unlisted dry bulk ship operator, owned by horse breeder and former chairman of Royal Western India Turf Club Khushroo N. Dhunjibhoy, bought two eight-year-old Panamax dry bulk carriers earlier in April from Greek and Norwegian owners, according to a ship broker, who did not want to be named.
Globally, ship prices have fallen by around 40% in the last two years.
An executive at Five Stars confirmed the ship purchase. “Amongst the dry bulk cargo carriers, Panamax ships are earning the most in the market today,” he said on condition of anonymity.
Five Stars now has three Panamax ships, called so because these can transit the Panama Canal fully laden.
The Baltic Exchange Panamax charter rate index has averaged $29,900 a day this year, boosted by record port congestion in China and Australia, as well as strong demand for coal cargo.
Chinese demand for iron ore has also not slackened. The nation has now turned to countries such as Ukraine and India to source iron ore. Shipments from Ukraine and India typically require smaller ships such as Panamax bulk carriers.
Strong coal markets, which employ around two-thirds of the Panamax fleet, have also pushed up the average Panamax rate.
“Panamax ships are expected to really do well in the market,” the executive at Five Stars said.
The firm’s fleet of nine ships includes a capesize vessel, the largest of the dry bulk cargo ships, that it has rented out to China Ocean Shipping (Group) Co.
p.manoj@livemint.com
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First Published: Mon, Apr 26 2010. 11 20 PM IST