VLGC upside may have to wait until US export increase in Q3/4

This month, the VLGC market remained stable, hovering around $30,000 per day amid limited arbitrage opportunities. The soft market so far this year has been driven by reduced activity, but rates may rebound post-winter as arbitrage improves. Fearnley Securities sees upside potential in the second half of ’25, as US export capacity expands – potentially driving rates higher.

Looking further ahead, 2026 is expected to be strong, with LPG and ammonia tonne-mile trade growing by 7.9%, outpacing fleet growth of 6.8%. US and Middle East terminal expansions and 8% growth in Asian imports further reinforce a positive long-term outlook despite ongoing US-China trade uncertainties.

Ammonia segment gains momentum after massive EU outlay
February was a positive month for ammonia, highlighted by the EU’s €422M investment in alternative fuels, supporting clean fuel infrastructure, including onshore power, hydrogen refuelling, and ammonia/methanol facilities. This funding strengthens the long-term viability of ammonia-fueled shipping, benefiting European Maritime Finance’s VLAC portfolio.

Additionally, the first-ever time charter for an ammonia-fueled vessel was signed this month. Yara Clean Ammonia and NYK agreed to charter an ammonia-fueled medium gas carrier, set for delivery in November 2026, marking a key milestone in reducing emissions in shipping.