Paragon Shipping Receives Request to Renegotiate Vessel Charter

Paragon Shipping Inc. (PRGN), a Marshall Islands-incorporated owner of 16 dry-bulk vessels, said a customer asked to renegotiate the rent for a supramax ship.

Deiulemar Compagnina di Navigazione SpA asked to change the $33,750 a day it’s paying to hire the Friendly Seas, Paragon said today in a statement. The charter with the Naples, Italy- based company runs for 27 more months, according to Paragon. Supramaxes haul minerals and grains.

Renters of dry-bulk vessels are asking to renegotiate long- duration charters arranged before rates plunged, reducing earnings to the lowest level in almost three years. The Baltic Dry Index, a measure of commodity shipping costs, is down 44 percent this year, according to the Baltic Exchange. Average rates to charter supramaxes for single voyages are the lowest in 35 months at $9,695 a day, the exchange’s figures show.

China Cosco Holdings Co. agreed in August to lower longer- duration charter rates with shipowners covering 18 vessels. Golden Ocean Group Ltd., an Oslo-based owner and operator of dry-bulk vessels, said Jan. 5 it changed payment terms for longer-duration charter contracts for two capesize vessels, the largest in the dry-bulk fleet. Athens-based Star Bulk Carriers, with 15 ships, said Jan. 9 it negotiated the early return of a dry-bulk ship.

Deiulemar sought a “commercial solution” to lower the charter rate, Nicola Gerado, a spokesman for the company’s charter department, said by phone.

Paragon paid $79.3 million in June 2008 to buy the Friendly Seas and owes $36.6 million, according to filings with the U.S. Securities and Exchange Commission.

To contact the reporter on this story: Michelle Wiese Bockmann in London at mwiesebockma@bloomberg.net

To contact the editor responsible for this story: Alaric Nightingale at anightingal1@bloomberg.net

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