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The dry bulk market has exhibited a mixed performance since the beginning of the year

The dry bulk market has exhibited a mixed performance since the beginning of the year, with different segments experiencing varying trends. While some sectors have either seen steady growth or have remained relatively stable, others have faced challenges. The Capesize market, in particular, has experienced a remarkable surge since the beginning of August with Baltic 5TC Average increasing by nearly 41%, closing the week at USD 26,826/day. While this marks a substantial improvement from the year-to-date low reached in mid-January (almost 85% up), it remains approximately 25% below the YTD peak touched in mid-March. This growth in Capesize 5TC Average is primarily fuelled by a significant uptick in Chinese demand for iron ore and coal. From January to August, China's imports of iron ore reached 815 million tonnes, a 5% increase compared to the same period in 2023. Similarly, coal imports rose by 12% to 340 million tonnes. This positive trend interprets an overall healthy Capesize market. Conversely, the Panamax sector has experienced a downward trend since March 19th, when the 5TC Average reached its year-to-date high of USD 20,757/day. While the Panamax 5TC Average has seen 10 positive closings and a 19% increase since September 6th, when it hit its year-to-date low, the overall trend remains descending. This suggests that despite some recent improvements, the Panamax market is still facing headwinds. The downward trend in the 5TC Average of the past 6-month period has impacted the Panamax second-hand prices, with recent transactions indicating a significant price correction. This week, two 2013-Chinese-built Panamax vessels were sold for approximately USD 18 million each. This marks a 10% drop compared to similar vessels sold in August, indicating a shift in market sentiment. Buyers are becoming more cautious and are negotiating for lower prices. Finally, The Supramax and Handysize sectors have exhibited a relatively stagnant performance since the beginning of the year, with minor fluctuations. The Supramax 10TC Average is currently trading at USD 14,256/day. This level is approximately 13% below its year-to-date high reached in late April and around 26% higher than its 2024 low which occurred in late January. Last but not least, the Handysize 7TC Average reached its peak on January 2nd at USD 14,537/day. Currently, it stands at USD 12,730/day, which is nearly 25% higher than its year-to-date low which was seen on February the 14th.

Moving from dry bulkers to wet trade, the recent surge in US Gulf Coast (USGC) diesel exports to Northwest Europe and the Mediterranean highlights the fluidity of the global energy market. Favorable freight rates and strong refinery production have driven this exceptional trade flow, while Brazil's fluctuating imports offered an additional opportunity for US suppliers. However, Russia's dominance in Brazil's diesel market and potential shifts in local demand suggest the USGC's rise may be temporary. Meanwhile, Russian refined product exports are likely to increase as countries prepare for their own maintenance schedules. In Brazil, the growing refined products market, supported by rising retail sales, suggests that diesel demand will remain strong, with economic growth and increasing GDP further boosting consumption. Additionally, the recent sharp decline in Urals crude prices has raised concerns over the oil price cap. As prices approach the $60 per barrel threshold, Western shipowners face a critical decision on whether to transport Russian oil. This could boost tanker fleet utilization but marginalize the dark fleet, which carries the majority of Russian oil exports under substandard conditions. This decision may have far-reaching effects on the tanker market and energy sector.

Sale and Purchase:

Dry:

Newcastlemax has performed exceptionally well so far this year, with 32 vessels sold year-to-date, which represents a 60% increase compared to the same period last year. This week, the "Mineral Cloudbreak" - 205K/2012 HHIC was sold for USD 38.5 mills to Chinese buyers, while the Electronic M/E "Golden Gayle" - 207K/2011 Universal found new owners for USD 40 mills. On the Capesize sector, Chinese buyers acquired the "China Peace" - 174K/2005 SWS for region USD 20 mills. Momentum was strong in the Kamsarmax and Panamax sectors, accounting for half of all sales this week. Greek buyers acquired the Kamsarmax "Vincent Triton" - 81K/2020 Jiangsu Hantong for USD 30.5 mills. On the same sector, the "AM Hamburg" - 82K/2013 New Times and "AM Quebec" - 82K/2013 New Times were sold for USD 18 mills each to Chinese buyers. The Supramax "Visayas" - 56K/2010 Mitsui changed hands for high USD 16 mills basis surveys due. Last but not least, the Handysize "Yochow"- 34K/2015 Namura changed hands for USD 19 mills, while the Electronic M/E Handysize "Belle Plaine"- 35K/2014 Qingshan was sold for USD 16.5 mills.

Wet:

On the tanker S&P activity, the VLCC "Advantage Virtue" - 296K/2009 Bohai was sold for USD 51 mills to Chinese buyers. Moving down the sizes, Pertamina acquired the Scrubber fitted LR2 "Sti Lily" - 110K/2019 New Times for USD 73.5 mills, and the Ice Class 1A, Scrubber fitted LR2 "Alkinoos"- 110K/2019 SWS for USD 73.5 mills. The MR2 "Caribbean Star"- 46K/2004 Shin Kurushima was sold for USD 17.9 mills. Finally, the Small StSt tanker "Horin Trader" - 20K/2015 Usuki was sold for high USD 31 mills to clients of Woojin.

Xclusiv Shipbrokers Inc.