News in English

Small fluctuations in 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 continued with marginal gains compared to the previous week, showing two faces. On the one hand, Capes and Handies moved in the green, while Panamaxes and Supramaxes in the red, compared to the previous week. In detail, Capes rose by 5.53%, Kamsarmaxes -0.71%, Ultramaxes (63) -0.67% and Handies +3.16%, compared to the beginning of the previous month. Thus, the BDI rose by 56 credits, compared to the previous week and closed at 2259 credits on Friday, September 26.
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, the week passed with quite some action from the largest miners. However, on the last day of the week, the pace dropped. The index levels on the Australia-China route (C5) closed on Friday at $10.9/tn.
In the Atlantic Basin and especially in the south, the week started with a rally due to new cargoes but this was exhausted in the first half of the week. In the north, the picture was similar with gains at the beginning of the week mainly for trips to Asia. The indexes on Friday reached up to $25.94/tn for trips from Brazil to China (for the C3 route), while rates from Continent to Asia closed at $51.51K/day (for the C9 route) and Transatlantic round trips at $31.23K/day (for the C8 route).
Regarding Kamsarmaxes, there was a lot of activity in the Atlantic basin and especially in the north, however the trends were mixed. At the beginning of the week we saw an increase in transatlantic trips which did not continue afterwards. In the south, rates remained stable at the same levels as the previous week. No significant changes in capacity supply are expected while mineral and grain cargoes will keep the market active. Indicatively, rates for trips from the East Coast of South America (ECSA) to the Far East reached up to $ 14-16 K/day (delivery Asia), from Continent to Asia at $ 25.5-27.5 K/day (delivery in Continent) and round Transatlantic trips at $ 16.5-18.5 K/day (delivery in Gibraltar).
On the other hand, in Asia, bad weather conditions seemed to have helped the market since they kept the number of open vessels at low levels. At the same time, cargo flow increased with interest focused on Indonesia and Australia. Rates for round trips in Southeast Asia-Far East moved to $ 16-18K / day (delivery Far East).
For Supramaxes-Ultramaxes, Southeast Asia declined after the volume of vessels significantly exceeded that of cargoes, the majority of which concern October dates. UMXs rates for trips between SE Asia and the Far East went to 14.5-16K / day. Further north, in the Far East, the market started the week at a low pace but in the middle of the week the flow of cargoes from the North Pacific increased, improving the climate. UMXs for round trips in the North Pacific (NOPAC) were at $13.5-15K/day, for trips to W. C. India at $16-17.5K/day and return trips to the Atlantic Basin (BH) at $13.5-15K/day.
In the Middle East Gulf and West C. India the market started the week sluggishly due to oversupply of vessels and limited demand. However, it is worth noting that support came to the market from South Africa. Fares for UMXs for Far East trips ranged from $13-14.5K/day (from Middle East’s Gulf (MEG) – West C. India (WCI)), for short trips between Middle East Gulf – West C. India at $15-16.5K/day and trips to the Atlantic Basin at $10.5-12K/day.
In the Atlantic Basin and especially the American Gulf it was quiet due to the ASBA however rates continued to rise. It is worth noting that vessels moving from the West Coast are exerting more pressure but demand is sufficient to absorb the excess supply. On the other hand, Transatlantic trips moved positively. UMXs rates for Transatlantic trips reached up to $34.5-36K/day and to Asia at $31.5-33K/day. The ECSA region started the week with a strong increase in demand pushing rates up, mainly for routes to Asia. UMXs rates for trips to SE Asia-China moved to $27.5-29K/day and for Transatlantic trips (Mediterranean/Continent) at $27.5-29K/day.
Continent showed limited activity but maintained its momentum, as capacity supply remained at low levels. UMXs rates for round-local trips moved at $15-16.5K/day, for SCRAP trips to the Mediterranean at $26-27.5K/day and to Asia at $24.5-26K/day. The Mediterranean showed two faces. On the one hand, the Western Mediterranean and the Black Sea moved positively while the Eastern Mediterranean declined due to low demand. Indicatively, it is reported that a UMX for a trip from the Mediterranean to Asia closed at $ 21.5-23K/day (delivery Canakkale), to the other side of the Atlantic Basin at $ 12.5-14K/day and within the Mediterranean at $ 14.5-16K/day (excluding war zones).
In the Handies market, in Continent the market moved upwards with limited capacity allowing shipowners to raise their ideas. The rates for the largest vessels in the category, for round trips, reached up to$ 16-17.5K/day, to the Mediterranean with scrap cargo at $ 19.5-21K/day and for Transatlantic trips at $ 12-13.5K/day.
The Mediterranean showed a lot of activity with interest mainly focused on the Western Mediterranean which was positively influenced by the good image of Continent and the other side of the Atlantic Basin. The rates of the largest vessels (over 36K tons DWT) for trips within the Mediterranean moved at $ 13-14.5K/day (delivery in Canakkale), to Continent at $ 13.5-15K/day (delivery in Canakkale), to the other side of the Atlantic Basin at $ 11-12.5K/day (delivery in Canakkale) and to Asia at $ 15-16.5K/day.
On the other side of the Atlantic Basin, in the American Gulf, the market started the week calmly with attention focused on ASBA. However, in the middle of the week, charterers mobilized, trying to cover their needs as soon as possible. Indicatively, the rates of the largest vessels in the category for trips to the other side of the Atlantic Basin ranged between $ 23.5-25K/day and to Asia at $ 19.5-21K/day.
The East Coast of South America (ECSA) region started the week with few new cargoes and reduced activity. However, in the second half of the week, some cargoes made their appearance, stirring the waters and balancing supply with demand. Thus, the rates of the largest vessels from the ECSA region for Transatlantic trips (Continent-Mediterranean) ranged between $ 22-23.5K/day and to Asia at $ 18-19.5K/day.
In Asia and especially in the north, more stability was observed and attention is now turning to October cargoes. In the south, the market proceeded without particular variations, however, hurricanes are causing various delays in ports. Further west, in the Middle East Gulf and W. C. India, the week passed slowly with few new cargoes and a concentration of capacity. The rates of the largest vessels in the category for round trips in the Far East and NOPAC closed at $ 11-12.5K / day, from SE Asia to China at $ 12-13.5K / day and from West C. India to China at $ 8-9.5K / day.

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