Disciplined Capital Allocation: means favoring eco, provenance -secure, and charter-backed assets, while this doesn’t necessarily means that shrewd seasoned ship-owners are avoiding tonnage whose upside is based on their cyclical nature.
The global maritime Sale and Purchase (S&P) market in 2025 is defined by a confluence of policy shocks, cyclical freight swings, and structural adjustments to risk pricing. Tariff impositions, liquidity shifts, and regulatory pressure are reshaping how capital allocates into shipping, with vessel provenance and compliance now weighted as heavily as freight earnings.
1. Tariffs and the Impact on Vessel Values
The imposition of tariffs on Chinese-built ships, scheduled for full effect in October 2025, has reshaped shipbuilding economics. These measures apply additional costs for Chinese-built vessels calling at U.S. ports, disrupting decades of cost advantage.
One of the most significant factors shaping the shipping Sale and Purchase market this year has been the imposition of tariffs, particularly affecting Chinese-built ships compared to their Japanese counterparts. Buyers have demonstrated caution toward Chinese tonnage, as tariffs have effectively reduced its attractiveness in both financing and resale value. As a result, a clear pricing gap persists between Japanese and Chinese vessels of similar age and specifications. Provence Premium Spread Widening: Historically, Chinese-built bulkers traded at a 10–15% discount to Japanese units. In 2025, that gap has widened to 30–40% for some mid-age Handy & Supramax tonnage. For example, a 10-year-old Chinese-built Supramax is currently changing hands at around $14.5–15.5 million, while an equivalent Japanese-built unit commands $19.5–20.5 million. This premium of roughly 30% underscores the market’s consistent preference for Japanese quality, perceived longevity, and stronger residual value despite the additional cost. The tariffs have only widened this spread, as risk-averse buyers steer toward vessels that are easier to finance and charter. Liquidity Divide: In Q2, nearly 65% of Japanese-built sales marketed found a buyer within 60 days; the equivalent figure for Chinese-built candidates was under 20%.Vessels with poor fuel efficiency or Chinese provenance saw thin buyer interest, often sitting on the market for 90–120 days without firm offers. This gap also highlights a broader trend: investors and owners see Japanese-built tonnage as a safer store of value, while Chinese units remain largely price-driven purchases, especially in more speculative plays.Tariffs have effectively compressed the historic “China discount” into a long-term penalty, embedding geopolitical risk into asset pricing and financing terms.
2. Volumes of S&P Transactions
Transaction volumes this year have closely followed the trajectory of freight earnings. The first quarter was muted, with limited activity due to depressed freight levels. However, anticipation of tariff hikes triggered a degree of front-loading of raw material purchases in late Q1 and early Q2, with charterers rushing to charter vessels, hence we saw trickle down effect on the Sale & Purchase volumes as well, as freights especially in the Dry Bulk segment improved the buyers sentiment. Front-loaded deals in Q2/Q3: Transaction counts rebounded as buyers accelerated purchases of Japanese/Korean tonnage ahead of the October tariff deadline. In June alone, over 3.5m dwt changed hands, a monthly high for the year. Overall, dry bulk S&P activity rose by more than 20% in the first half compared to the same period last year, despite soft freight performance. Tanker volumes, however, were more subdued as earnings correction in late 2024 left some hesitation in the market. Buyers in bulkers were particularly aggressive in the geared segment (Handy and Supramax), seeing value opportunities amid the widening Japanese vs Chinese pricing gap.
3. Tanker Market Asset Values
The tanker sector has undergone a dramatic correction since its peak. Asset values in the crude tanker segment fell sharply during 2025, particularly in the VLCC class, where benchmark earnings significantly corrected. Values for modern VLCCs dropped by nearly 20% in less than six months. Buyers are positioning selectively; MRs, Aframax and Suezmax units attract stronger competition, while VLCCs remain a latent value play. That said, recent months have shown the first signs of revival, particularly in the Suezmax and Aframax segments, as increased ton-mile demand and shifting trade patterns begin to filter into earnings. The VLCC market remains subdued and “waiting for revival,” as demand growth has yet to match the capacity overhang. Investors are increasingly eyeing VLCCs as a counter-cyclical play, with prices starting to show some signs of stabilization. Last but not least, the MR2 segment after showing significant correction, we are seeing the reemergence of several buyers in the 15 year Old segment, where the values have significantly corrected. The key question for investors is timing, but there is no doubt that the large crude carrier sector is poised for upside once freight rates recover.
4. Gas Market
The gas carrier sector presents a split narrative. On one hand, the LNG market has been at historical lows, with both spot and shortterm charter rates depressed. Ample fleet availability combined with softer-than-expected Asian demand growth has weighed heavily on sentiment. LNG carrier asset values reflect this weakness, with modern units trading well below their highs of 2022–2023.
S&P liquidity in gas is polarized: LNG deals are limited to charterbacked tonnage, while VLGCs remain hotly contested with buyers reluctant to part with income-generating assets. On the other hand, the LPG market has outperformed significantly, driven by strong propane demand, particularly in Asia and the U.S.- Asia trade flows. Earnings for Very Large Gas Carriers (VLGCs) have remained resilient, supporting firm secondhand values. Some vintage LPG units have even appreciated in value over the last year, a stark contrast to the LNG segment.
VLGCs: Freight rates surged past USD 60/ton on the U.S.–Asia route in Q2, equating to daily earnings of ~USD 65,000/day, nearly triple the five-year average
Spot LNG carrier rates fell to as low as USD 15,000/day in Q1 2025, the lowest in a decade, due to oversupply and delayed liquefaction projects. The bifurcation between LNG and LPG highlights the importance of commodity fundamentals, as LPG’s strong industrial and residential consumption base provides stability even during wider market corrections.
5. Dry Bulk and Container Markets
In dry bulk, values have rebounded in line with stronger-thanexpected freight performance in Q2 and Q3. Older tonnage has been particularly active, supported by a favorable price-to-earnings ratio. Buyers see these vessels as attractive plays, able to generate substantial returns within just a few years of solid freight earnings.
Healthy Spot Earnings In Dry Bulk: Freight averages in 2025 have been range-bound, with lately showing some signs of sustained revival; Currently spot earnings are hovering around for Capesize USD 23,000/day, Kamsarmaxes) USD 15,500/day, Supramaxes at USD $17,750/day and Handysize at USD 13,000/day. The difference between Chinese and Japanese-built tonnage remains highly pronounced in bulkers. For instance, a 10-year-old Chinese Supramax is priced at $14.5–15 million, while the Japanese equivalent commands $19.5–20 million. This spread demonstrates the premium investors are willing to pay for quality tonnage, especially in a rising freight environment. On the container side, long-term time charter (TC) rates for feeder vessels (1–2 year TC) have remained stronger than many expected, even as the larger boxship market has corrected. This dynamic has turned vintage feeder vessels – some as old as 15 years – into attractive investment opportunities. Their relatively low acquisition costs and strong TC coverage potential offer investors secure income and an efficient entry point into the container trade.
Tariff Exposed Fact: Modern eco vessels tied to charter coverage command strong premiums, while older and tariff-exposed ships trade at heavy discounts. Both bulk and feeder containers are now presenting compelling short-to-medium term opportunities, with solid cash-on-cash returns supported by resilient charter markets.
6. Newbuilding Market and Strategic Outlook
Global new orders in H1 2025 totaled under 12m dwt, less than half the level recorded in the same period of 2023. Newbuildig activity has slowed significantly, as tariff risks and uncertainty around regulatory frameworks weigh on sentiment. Compared to the previous year, orders are down nearly 70% in dry bulk segment, with many owners preferring to acquire modern secondhand units rather than commit to expensive and uncertain newbuilds.
The Net Fleet Growth Valve: With net fleet growth projected at only ~2.1% in 2025–26, the slowdown curbs speculative overcapacity and lends medium-term support to freight markets.
This hesitancy is amplified by the wide gap between newbuilding prices and secondhand earnings potential. While shipyards remain busy with legacy orders, fresh contracting is limited outside of gas carriers and specialized tonnage. The newbuilding slowdown reinforces the case for secondhand values, as supply growth is capped at a time when demand in dry bulk and LPG remains resilient.
Blessing in Disguise: The newbuilding slowdown acts as a stabilizer, suppressing speculative growth and indirectly supporting asset values across the board.
Conclusion
This year’s S&P market has been shaped by tariffs, divergent sector fundamentals, and a cautious outlook on newbuilding activity. The clear pricing gap between Chinese and Japanese tonnage continues to define transaction strategies, while the correction in Tankers and LNG contrasts with the recent strength in bulkers, LPG, and feeder containers.
Investment Tectonic Shift: We are shifting to a risk-adjusted cash flow lens: Ships are no longer evaluated solely as freight vehicles, but as long-term financial instruments whose viability hinges on compliance, technology, and geopolitical optionality.
For some investors, the message is cautiously optimistic: the current environment offers interesting entry points, particularly in the dry bulk sector and selectively in wet & container segments. With older vessels generating healthy returns relative to their acquisition cost, while constrained newbuilding activity, keeping future in check, the supply-demand balance is favorable. The positive combination of attractive valuations, resilient freight rates, and capped future supply sets the stage for a rewarding investment window in shipping today.
Disciplined Capital Allocation: means favoring eco, provenance - secure, and charter-backed assets, while this doesn’t necessarily means that shrewd seasoned ship-owners are avoiding tonnage whose upside is based on their cyclical nature.
Data source: Doric