While demand for commodities is picking up as the world economy recovers, the shipping sector is struggling to absorb growing vessel supply.
Clay Maitland, managing partner with the Marshall Islands Registry, the world's third largest open ship registry, said some operators were set to benefit from the soft conditions in the dry bulk sector.
"A lot of operators who have the cash are now looking at expansion -- there are a lot of bargains out there," he told Reuters in an interview.
"It is a good time to buy tonnage in the dry bulk market. Values are low, prices are low," he said. "We are going to have a lot of tonnage."
Greek ship owners are among players gearing up for expansion aiming to snap up vessel assets at lower prices.
Dry bulk company Paragon Shipping is among shipping groups that have already announced vessel purchases in recent days.
The value of a five-year old capesize vessel, the largest size of dry bulk ship, has fallen to around $60 million from as much as $180 million in 2008 before the downturn, Baltic Exchange data showed.
Maitland said conditions for some shippers in the sector was likely to get tougher.
"There are some operators who are going to do very well because they have already locked in contracts for the carriage of grains and also iron ore and almost all dry bulk commodities," he said.
"You are going to get a combination of feast and famine -- some are going to feast but there is going to be famine for others."
Maitland said it was likely that some dry bulk ships could be laid up this year. A lay-up occurs when a ship temporarily stops trading for a period due to poor market conditions enabling a ship owner to save costs.
"On the one hand you have growing commodity demand but you don't have enough to offset the oversupply," Maitland said. (Reuters)
