Shipping assets plunge unparalleled: HSBC

A plunge in the price of ships as assets, caused by a collapse in global growth just after owners had placed record orders for new vessels, has no historical precedent, according to HSBC Shipping Services,the consulting and shipbroking unit of the bank.

The value of five-year-old Capesize vessels that haul about 180,000 metric tonnes of iron ore fell 79% to $33 million since rising to a record in August 2008, according to data from Clarkson Research Services, a unit of the world's largest shipbroker. Tankers hauling 2 million barrels of oil plunged 61% to $65 million compared with their peak the same year.

The collapse is because owners amassed a record order book for new ships in 2008, when rates for Capesizes were more than 118 times higher than today , data from Clarkson showed. Global economies contracted the most since World War II the following year, curbing trade and precipitating a freight-rate slump.

"This astonishing loss of value is, as far as we are aware, without precedent in shipping history," HSBC Shipping said in a report last week. "The bubble became so inflated that its bursting has caused untold damage to all market players , from ship owners and charterers to shipbuilders and banks."

Daily earnings for VLCCs plunged 99.53% from a high of $290,336 in December 2007 to $1,363 as of July 20, according to Clarkson data. Capesize vessels are earning $1,862 a day, a 99 percent slump from a 2008 high of $218,955 daily.