Excel, Genco Fall on Rate Drop, DryShips Loan Concern

Excel Maritime Carriers Ltd. (EXM) fell 16 percent and Genco Shipping & Trading Ltd. (GNK) declined 9.3 percent as transport rates fell for the 14th straight day and auditors said DryShips Inc. (DRYS) might miss debt payments.

Excel fell 86 cents to $4.45 in Nasdaq Stock Market composite trading. Genco dropped $1.29 to $12.58.

The Baltic Dry Index (BDIY), a measure of shipping costs for commodities, fell 32 points, or 1.9 percent, to 1,646 points, according to the Baltic Exchange. The 14 consecutive days of declines are the most since Nov. 4.

“Iron ore and steel inventories have increased in recent weeks as steel prices have fallen, indicating Chinese production has outpaced demand,” Omar Nokta, an analyst at Dahlman Rose & Co. in New York, said in an investor note today.

Rates to hire Capesize vessels that typically haul raw materials to make steel fell 1.1 percent to $18,258 a day. Daily rents for smaller Panamax ships that compete for those cargoes and carry grains dropped 3.9 percent to $11,481.

Dry-bulk-vessel owners were also hurt by DryShips’ announcement that company auditors have “substantial doubt about its ability to continue as a going concern.”

DryShips fell 91 cents, or 16 percent, to $4.95. Eagle Bulk Shipping Inc. (EGLE) declined 51 cents, or 11 percent, to $4.21. Diana Shipping Inc. (DSX) dropped $1.62, or 12 percent, to $11.58.

“The auditors are saying, ‘Look, this is the situation and it’s pretty dire,’” Natasha Boyden, an analyst at Cantor Fitzgerald LP in New York, said in a telephone interview. “Banks are going to try to work with the company best they can to see the company through. I imagine the (loan) terms will be much more punitive.”

The Bloomberg Dry Ships Index, a capitalization-weighted index of 12 shipowners, fell 105.36, or 8.2 percent, to 1,174.90. The index has fallen 74 percent in the past year.

To contact the reporter on this story: Todd Zeranski in New York at tzeranski@bloomberg.net

To contact the editor responsible for this story: Dan Stets at dstets@bloomberg.net

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