Diana Shipping Inc. Announces Time Charter Contract for m/v Maera with ST Shipping
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Insights
The recent charter contract between Diana Shipping Inc. and ST Shipping and Transport Pte. Ltd. represents a strategic move in the maritime industry, particularly within the dry bulk sector. The Panamax vessel, m/v Maera, will be chartered at a gross charter rate of US$13,750 per day, which is an increase from its previous rate of US$12,000 per day with Cargill International S.A. This increment in the daily rate indicates a favorable market condition for shipowners, potentially due to increased demand for dry bulk transportation or limited supply of available vessels.
Furthermore, the contract stipulates a flexible period, which could be beneficial for Diana Shipping in terms of operational planning and revenue stability. The generated gross revenue of approximately US$4.03 million for the minimum scheduled period is a significant figure and contributes to the company's financial strength. The average age of Diana Shipping's fleet being 10.59 years suggests a moderately aged fleet that might require less maintenance than older vessels, potentially leading to lower operational costs and higher profitability.
Analyzing the financial implications of the new time charter contract for Diana Shipping Inc., the increase in the charter rate from the previous contract with Cargill International could lead to an improved bottom line for the company. Assuming the vessel is operational throughout the charter period without significant off-hire periods, the projected revenue signifies a solid income stream. Investors and stakeholders should note that the shipping industry is cyclical and sensitive to global economic changes, meaning that current rates may not be indicative of future earnings.
It is also important to consider the 5% commission paid to third parties, which slightly reduces the net income from the charter. However, the overall impact appears positive and the company's diversified fleet composition, with various vessel types and sizes, provides a hedge against market volatility in specific segments of the dry bulk market.
From a market perspective, the chartering of the m/v Maera by Diana Shipping can be seen as a reflection of the current state of the dry bulk industry. The demand for Panamax vessels, typically used to transport cargo such as coal, grain and other commodities, is often influenced by global trade patterns and economic activity. The fact that Diana Shipping has locked in a charter until at least November 2024 suggests a positive outlook on market conditions and trade volumes for the near future.
Moreover, the consistent renewal of charters and the ability to secure higher rates could be indicative of a tightening supply in the Panamax segment, which might be due to a slowdown in new vessel deliveries or an increase in scrapping older vessels. This situation could present a favorable scenario for shipping companies like Diana Shipping, potentially leading to increased charter rates and improved profitability in the sector.
ATHENS, Greece, Jan. 22, 2024 (GLOBE NEWSWIRE) -- Diana Shipping Inc. (NYSE: DSX), (the “Company”), a global shipping company specializing in the ownership and bareboat charter-in of dry bulk vessels, today announced that, through a separate wholly-owned subsidiary, it has entered into a time charter contract with ST Shipping and Transport Pte. Ltd., for one of its Panamax dry bulk vessels, the m/v Maera. The gross charter rate is US
The “Maera” is a 75,403 dwt Panamax dry bulk vessel built in 2013.
The employment of “Maera” is anticipated to generate approximately US
Diana Shipping Inc.’s fleet currently consists of 40 dry bulk vessels: 4 Newcastlemax, 9 Capesize, 5 Post-Panamax, 6 Kamsarmax, 7 Panamax and 9 Ultramax. As of today, the combined carrying capacity of the Company’s fleet is approximately 4.5 million dwt with a weighted average age of 10.59 years. A table describing the current Diana Shipping Inc. fleet can be found on the Company’s website, www.dianashippinginc.com. Information contained on the Company’s website does not constitute a part of this press release.
About the Company
Diana Shipping Inc. is a global provider of shipping transportation services through its ownership and bareboat charter-in of dry bulk vessels. The Company’s vessels are employed primarily on short to medium-term time charters and transport a range of dry bulk cargoes, including such commodities as iron ore, coal, grain and other materials along worldwide shipping routes.
Cautionary Statement Regarding Forward-Looking Statements
Matters discussed in this press release may constitute forward-looking statements. The Private Securities Litigation Reform Act of 1995 provides safe harbor protections for forward-looking statements in order to encourage companies to provide prospective information about their business. Forward-looking statements include statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions and other statements, which are other than statements of historical facts.
The Company desires to take advantage of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and is including this cautionary statement in connection with this safe harbor legislation. The words “believe,” “anticipate,” “intends,” “estimate,” “forecast,” “project,” “plan,” “potential,” “may,” “should,” “expect,” “pending” and similar expressions identify forward-looking statements.
The forward-looking statements in this press release are based upon various assumptions, many of which are based, in turn, upon further assumptions, including without limitation, Company management’s examination of historical operating trends, data contained in the Company’s records and other data available from third parties. Although the Company believes that these assumptions were reasonable when made, because these assumptions are inherently subject to significant uncertainties and contingencies that are difficult or impossible to predict and are beyond the Company’s control, the Company cannot assure you that it will achieve or accomplish these expectations, beliefs or projections.
In addition to these important factors, other important factors that, in the Company’s view, could cause actual results to differ materially from those discussed in the forward-looking statements include the continuing impacts of the COVID-19 pandemic; the strength of world economies and currencies, general market conditions, including fluctuations in charter rates and vessel values, changes in demand for dry bulk shipping capacity, changes in the Company’s operating expenses, including bunker prices, drydocking and insurance costs, the market for the Company’s vessels, availability of financing and refinancing, changes in governmental rules and regulations or actions taken by regulatory authorities, potential liability from pending or future litigation, general domestic and international political conditions, including risks associated with the continuing conflict between Russia and Ukraine and related sanctions, potential disruption of shipping routes due to accidents or political events, including the escalation of the conflict in the Middle East, vessel breakdowns and instances of off-hires and other factors. Please see the Company’s filings with the U.S. Securities and Exchange Commission for a more complete discussion of these and other risks and uncertainties. The Company undertakes no obligation to revise or update any forward-looking statement, or to make any other forward-looking statements, whether as a result of new information, future events or otherwise.
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