Safe Bulkers deems current secondhand prices unappealing amid market weakness

Notably, despite corrections, secondhand values have remained relatively resilient given the current trading environment. During the company’s Q1 earnings presentation, the US-listed owner’s chief executive noted secondhand vessel prices have declined over the past six months – by approximately 25% for older ships and 10–15% for modern tonnage.

These are not attractive levels to start buying ships now, considering where the freight market is, Mr Hajioannou told analysts.

The company has been quite active in the sale and purchase market over the past few years. Since 2021, it has sold 14 vessels with an average age of 15 years and acquired eight younger units, averaging 10 years old. However, in 2024, it refrained from purchasing any secondhand ships.

Meanwhile, the shipowner continues to prioritise its sizeable newbuilding programme, originally comprising 18 bulk carriers, with six vessels still under construction and scheduled for delivery by 2027.

Commenting on Safe Bulkers’ share repurchase strategy, Mr Hajioannou said the company is in no rush to restart its buyback programme after completing a 3M-share repurchase authorised last February. “We are waiting for an opportune time to buy stock. If the freight market stays at current levels, we’re not going to rush,” he explained.

Capesize employment strategy

Addressing Safe Bulkers’ Capesize deployment plans, Mr Hajioannou said the company is likely to favour spot charters for vessels becoming available in the near term.

Referring to the next Capesize coming open later this month, he said Safe Bulkers will initially employ the vessel in the spot market, with the aim of potentially securing a longer-term deal within a month, if conditions improve.

“We are trading in the spot market, unless we see period employment with a duration of a couple of years, above US$20,000 per day,” he added.

As of 9 May, Safe Bulkers had eight Capesize bulk carriers fixed on period charters, with six of these contracts extending beyond one year. The average daily hire was US$23,317.

First-quarter financials weaken

Safe Bulkers reported revenues of US$64.3M for the first quarter of 2025, down from US$81.7M in the same period last year. The company attributed the drop to lower charter rates and reduced earnings from scrubber-fitted vessels. Net income also fell to US$7.2M, compared with US$25.3M in Q1 2024.

“During the first quarter of 2025, we faced softer charter markets due to seasonality and geopolitical uncertainties,” said company president Loukas Barmparis.

Safe Bulkers currently operates a fleet of 47 bulk carriers with a combined capacity of 4.7M dwt and an average age of 10.1 years, excluding the six vessels under construction.