News in English

Finally a rise for the dry bulk cargo market

Iakovos (Jack) Archontakis
Commercial Director TMC MARITIME CO.

Dr. Fotios –Evangelos Karlis
Maritime Executive and Consultant

The dry bulk cargo market advanced with significant gains in all sizes, reaching double-digit increases compared to the previous week.

Capes in particular were up 40%. Specifically, Capes rose by 38.37%, Kamsarmaxes +19.38%, Ultramaxes (63) +15.86% and Handies +13.15%, compared to the previous week. Thus, the BDI rose by 189 credits, compared to the previous week and closed at 981 credits on Friday, February 21.
Let's see, in more detail, how the dry bulk cargo market moved last week by vessel's size, starting with the CAPEs. In Asia, Western Australia remained calm with miners being inactive. However, towards the end of the week the rest of Australia was active, improving the main C5 route. The index levels on the Australia-China route (C5) closed on Friday at $9.49/tn.
In the Atlantic Basin and particularly in the north, further improvements were observed but the biggest bonuses were given to the routes outside INL. And in the south, Brazil moved positively with more bookings and at higher levels. Friday’s indexees reached up to $18.2/tn for the Brazil-China trips or the C3 route), while the Continent-Asia rates closed at $27.2K/day (for the C9 route) and the Transatlantic round trips at $5.42K/day (for the C8 route).
Regarding Kamsarmaxes, in the Atlantic basin and particularly in the north, mixed trends were observed since transatlantic trips were few while trips to Asia pushed the indicators with more mineral and grain cargoes. In the south, improvements were noted mainly for loadings in mid-March. Indicatively, rates for trips from the East Coast of South America (ECSA) to the Far East reached up to $ 10.5-12.5K/day (delivery Asia), from Continent to Asia at $ 14-16K/day (delivery in Continent) and round Transatlantic trips at $ 6.5-8.5K/day (delivery in Gibraltar).
On the other hand, in Asia the week progressed positively since the list of vesels was constantly decreasing and the flow of cargoes was renewed. There was also increased interest in season charters. Roundtrip rates for Indonesia-Far East trades were at $8-10K/day (Far East delivery).
For Supramaxes-Ultramaxes, the market in Southeast Asia progressed positively with a steady flow of mainly coal cargoes and several closures. Support also came from the Australian market. UMXs rates for trades between SE Asia and the Far East went to $13-14.5K/day. Further north, in the Far East the market improved with even more cargoes to the Atlantic Basin and the North Pacific. UMXs for round trips in the North Pacific (NOPAC) were $11.5-13K/day, for trips to W. C. India at $11.5-13K/day and for return trips to the Atlantic Basin (BH) at $11-12.5K/day.
In the Middle East Gulf and West C. India the market showed satisfactory activity leaving a feeling that we will see several improvements. However, at the end of the week the market remained at the same levels or even slightly lower. UMXs for trips to the Far East ranged at $8.5-10K/day (from Middle East Gulf (MEG) – West C. India (WCI)), for short trips between Middle East Gulf – West C. India at $6-7.5K/day and for trips to the Atlantic Basin at $4.5-6K/day.
In the Atlantic Basin and especially the American Gulf, there was an increase in the supplied capacity since the cargoes for February have been booked and there are still available vessels. Even the cargoes in March are being booked at the current rates. UMXs rates for Transatlantic trips reached up to $ 14.5-16K/day and to Asia at $ 15.5-17K/day. The ECSA region moved upwards due to the great shortage of vessels while a small increase in demand will lead to even higher rates. UMXs rates for trips to SE Asia-China moved to $ 17-18.5K/day and for Transatlantic trips (Mediterranean/Continent) at $ 16-17.5K/day.
Continent showed improvements with many bookings taking place at higher levels compared to the previous week. The driver of this increase is the scrap cargo remaining for February while the supply of vessels was limited. UMXs rates for round-local trips moved at $ 11-12.5K/day, for SCRAP trips to the Mediterranean at $ 12-13.5K /day and to Asia at $ 16-17.5K /day. The Mediterranean continued its upward trends as especially in the first half of the week many vessels found some employment while demand remained stable. Indicatively, it is reported that a UMX for a trip from the Mediterranean to Asia closed at $ 12-13.5K/day (delivery Canakkale), to the other side of the Atlantic Basin at $ 6-7.5K/day and within the Mediterranean at $ 8.5-10K/day (excluding war zones).

In the Handies market, in Continent the market for the first time this year showed strong demand while the immediately available capacity also decreased. This time, charterers were under pressure to find a vessel to meet their needs. Rates for the largest vessels in the category, for circular trips, reached up to $ 12-13.5K/day, to the Mediterranean with scrap cargo at $ 12.5-14K/day and for Transatlantic trips at $ 7.5-9K/day.

The Mediterranean maintained the positive trend from the previous week with a slight improvement mainly for transatlantic trips. Although charterers moved slowly at the beginning of the week, the volume of closures increased at the end of the week. The rates of the largest vessels (over 36K tons DWT) for trips within the Mediterranean moved at $ 5.5-7K/day (delivery in Canakkale), to Continent at $ 5.5-7K/day (delivery in Canakkale), to the other side of the Atlantic Basin at $ 5.5-7K/day (delivery in Canakkale) and to Asia at $ 9-10.5 K/day.

On the other side of the Atlantic Basin, in the American Gulf, the market started the week with considerable optimism since there was a steady flow of Renault cargoes and the number of vessels was limited. However, rates remained at the same levels without any significant changes. Indicatively, freight rates for the largest vessels in the category for trips to the other side of the Atlantic Basin ranged between $9.5-11K/day and to Asia from $12-13.5K/day.

The East Coast of South America (ECSA) region started the week dynamically with a lot of interest for loadings at the end of the month until mid-March. In the second half of the week, the market stabilized as the cargo flow decreased. Thus, rates for the largest vessels from the ECSA region for Transatlantic trips (Continent-Mediterranean) ranged between $15.5-17K/day and to Asia from $15-16.5K/day.

In Asia, the market continued to grow both north and south, with strong activity in both regions. The only question mark in the south was the bad weather conditions. Further west in the Middle East Gulf and W. C. India, the increase in cargo lists also led to an improvement in activity, which was not reflected in the rates. The rates of the largest vessels in the category for round trips in the Far East and NOPAC closed at $ 9.5-11K / day, from S.E. Asia to China at $ 7.5-9K / day and from W. C. India to China at $ 6-7.5K / day.

Disclaimer
This report and the information contained herein it is for general information only and does not constitute an investment advice