Up $5.5 million in 7 months! Prices for these bulk carriers have jumped!

Recently, a transaction in the dry bulk used vessel market has sparked intense industry attention on Ultramax asset prices. Reportedly, a 64,000-ton Ultramax bulk carrier built by Japan's Shin Kasado in 2021, Dominator, was reportedly sold for about $38 million.

However, its sister ship of the same type, CMB Bruegel, was sold for $32.5 million in October 2025. In just about seven months, the price of a similar, Japanese-made, modern Ultramax has risen by about $5.5 million, an increase of nearly 17%. Additionally, in March this year, another ship of the same age and size, built by Shin Kurushima, Ability, was also sold for about $37 million, further confirming the rapid rise in the price of Hyundai Japan-made Ultramax assets.

BRS analyst Liu Qingzhi pointed out in his latest weekly report that, based on Valuation data from the Baltic Exchange, since February this year, the price of a 5-year-old second-hand Ultramax vessel has already surpassed the price of newbuild vessels of the same type. At the time of writing, this premium has expanded to about 6% and continues to grow.

Used ships are more expensive than new ones

BRS data shows that in the first four months of this year, the price of the 5-year-old Ultramax rose by 13.2%, reaching about $36.2 million; The price of the 10-year-old Ultramax rose 15.8%, reaching about $28.6 million. Meanwhile, Ultramax vessels aged 15 years and above have remained firm, rising 9% in the first four months of this year.

More notably, the price gap between the 5-year and 10-year Ultramax has narrowed from 26% in 2025 to 20%. This indicates that the rise is not limited to a few of the newest and highest-quality vessels, but rather that the entire Ultramax second-hand asset curve is being lifted.

The reasons for the phenomenon of ship price inversion

Facing the phenomenon where second-hand vessel prices exceed newbuild prices, Liu Qingzhi pointed out that current buyers are willing to pay a premium for used vessels that can be delivered quickly and can be immediately put into the spot and futures markets.

When discussing the reasons, she believes there are several main points:

First, shipyards and main engine equipment supply cannot keep up with market speed

Liu Qingzhi analyzed in the report that although Ultramax newbuilds still have longer economic lifespans and higher technical specifications, the reality is that the delivery cycle for new ships has significantly lengthened. Frontline Chinese shipyards are extremely tight in vessel space, and it is already difficult to secure available delivery slots before 2029. At the same time, shipyards are increasingly inclined to take on high value-added orders such as oil tankers and natural gas carriers.

More importantly, the supply of main units and generators has also become a relatively hidden bottleneck. According to market sources cited in the report, main unit capacity for the second half of 2028 has basically been fully booked; If buyers want to secure the main engine supply needed for ships delivered in 2029, arrangements are usually made at least 18 months in advance.

This means that placing an order for a new Ultramax vessel now, even if the nominal price is less than a used vessel aged 5 years, will still be difficult to capture market opportunities in 2026 and 2027. New ships delivered in the future cannot meet current capacity demands; But a modern second-hand ship that can be delivered immediately can enter the market and generate cash flow immediately.

Second, freight rates and the lease market are supporting asset prices in reverse

The BRS report points out that the bulk carrier market with cranes has remained strong recently, supported by the simultaneous strengthening of spot and lease markets. As the freight rate index continues to climb, fuel prices gradually stabilize after previous fluctuations, trade activity is marginally recovering, the number of containers has increased, and overall market activity has clearly improved.

From the perspective of the futures charter market, Ultramax's daily earnings have risen rapidly, prompting more shipowners to lock in time charter business at higher levels. The report shows that the recent transaction level for Ultramax 5- to 7-month lease has reached about $21,000 per day; Meanwhile, related transactions on the Indonesia to India West Coast route were also reported at about $30,000 per day.

This shows that buyers of used ships are willing to chase highs not simply by betting on continued price increases, but because they see real cash flow. A 5-year-old Ultramax vessel ready for immediate delivery means an asset that can immediately enter the spot or futures market and lock in a window of returns.

Third, the flexibility of Ultramax with gondolas is being repriced

However, Liu Qingzhi also pointed out in the report that the strength of the lease market only explains the price inversion; deeper support comes from the broader commercial flexibility of bulk carriers with cranes.

Compared to larger vessels, Ultramax's demand base is clearly diversified. These lifted bulk carriers do not rely heavily on a single cargo type, nor do they rely entirely on a few large deep-water ports. It can switch between a variety of cargo, including coal, grain, steel, cement clinker, nickel ore, manganese ore, salt, wood chips, petroleum coke, and more, and can also access more emerging market ports with relatively limited port conditions. This flexibility is becoming an important foundation for the market to assign Ultramax a higher valuation.

BRS cited AXSMarine data showing that in the first four months of this year, among Ultramax's top ten products, except for thermal coal and petroleum coke, which fell by 11% and 16% year-on-year, most major products saw growth. Wheat grew by 18%, clinker by 20%, corn by 76%, manganese ore by 20%, soybeans by 42%, salt by 10%, and wood chips by 8%. Therefore, for shipowners, this cargo type switching capability means stronger cyclical resilience; For renters, Ultramax offers more flexible and easier-to-deploy capacity options.

Looking at specific cargo inlets, the cement and clinker shipments from South China to Bangladesh have increased; Vietnam's nickel ore trade enters the seasonal export window from April to November; Steel exports remain healthy, supporting long-distance routes such as China, Japan, and South Korea to the Mediterranean, and China to West Africa; Indonesian coal exports gradually recovered after the release of new quotas in April, further boosting coal trade from Indonesia to India.

Therefore, this round of Ultramax's market strength is the result of multiple product types, regions, and trade directions recovering together. In a market where pallet demand is fragmented but overall active, Ultramax's scheduling flexibility makes it a major beneficiary vessel.

Fourth, effective transport capacity on the supply side is further compressed

Besides demand and revenue, changes on the supply side are also driving up the value of Ultramax used vessels.

The BRS report pointed out that, due to the impact of the Iran conflict, fuel shortages have forced some vessels to wait longer for refueling, and some have had to detour to alternative refueling ports. This has caused localized additional congestion and significantly exceeded the five-year average for Ultramax.

Therefore, when pallet activity recovers and available vessels are congested and waiting for further compression, shipowners' bargaining power naturally increases.

Future risk: Inversion may not last long-term

However, Liu Qingzhi also reminded in the report that the current Ultramax market is not without risks.

The report points out that the current average age of the Ultramax fleet is about 13.5 years, and overall it is still in the golden operational stage of its lifecycle. However, the order book for this vessel type remains large, accounting for about 25% of the existing Ultramax fleet. Meanwhile, Ultramax deliveries in 2026 are expected to reach their highest level in nearly 11 years.

This means that medium-term supply pressure has not disappeared. However, new ships delivered in the future cannot replace the second-hand ships already operating in the market today that can generate immediate cash flow. Therefore, at this stage, new supply pressures are more of a medium-term variable rather than a short-term factor that will immediately suppress the market.

Finally, the BRS report judges that as long as time charter rates remain high and regional cargo demand continues to absorb available capacity, the price of modern Ultramax used vessels may remain higher than newbuild prices.

But this premium heavily depends on the visibility of recent earnings. If risks in the Persian Gulf normalize, cargo momentum weakens, or time charter rates retreat, the price gap between 5-year-old Ultramax and newbuild vessels could also narrow rapidly.

Therefore, the current ship price inversion essentially does not mean that new ships have lost value, but rather that the market is raising the value of modern used ships—which are "ready to use and make money now"—to a higher level.

In short: new ships win by their lifecycle, second-hand ships by the time window.