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Capesizes Steer Dry Bulk Market Higher as Atlantic and Pacific Strengthen

By Iakovos (Jack) Archontakis

Senior Maritime Strategy Consultant - Chartering Executive & TMC Shipping  Commercial Director

and
Dr. Fotios-Evangelos Karlis
Maritime Executive & Shipping Consultant

The dry bulk freight market extended its upward momentum this week, driven primarily by a strong Capesize rally, with the segment posting double-digit gains compared with the previous week. The smaller vessel classes also ended the week in positive territory, although their advances were considerably more modest. Below is a closer look at how each vessel segment performed across the major trading regions.

More specifically, Capes rose by 13.54%, Kamsarmaxes gained 2.27%, Ultramaxes advanced 1.97%, while Handies declined by 2.9% compared with the previous week. As a result, the Baltic Dry Index (BDI) climbed by 227 points week-on-week, closing at 2,944 points on Friday, 10 July.

Let us take a closer look at developments across the dry bulk market, beginning with the Capesize sector.

Capesize

In Asia, the market maintained its upward trajectory, supported by continued activity from the major mining companies and a steady flow of cargoes from both Western and Eastern Australia. Consequently, freight rates on the benchmark Australia–China route (C5) increased by USD 2 per tonne over the course of the week. By Friday, the C5 index had settled at USD 13.32 per tonne.

Across the Atlantic, the market also recorded gains compared with the previous week. In the South Atlantic, cargo volumes remained healthy, while in the North Atlantic the rally was primarily driven by a tightening vessel supply. By Friday, the Brazil–China route (C3) stood at USD 33 per tonne, while rates for voyages from Europe to Asia closed at USD 75.34 thousand per day (C9), with transatlantic round voyages reaching USD 48.25 thousand per day (C8).

Kamsarmax

Activity across the Atlantic remained particularly strong, especially in the North Atlantic. However, with most prompt cargoes already covered, market participants are now watching closely to see whether fresh cargo demand will emerge to sustain the current positive trend. In the South Atlantic, attention centred on next month's grain cargoes, although charterers largely preferred to remain on the sidelines rather than commit immediately. Indicatively, rates for voyages from the East Coast South America (ECSA) to the Far East were assessed at USD 19.5–21.5 thousand per day (delivery Asia), while Europe-to-Asia business stood at USD 31–33 thousand per day (delivery Europe), and transatlantic round voyages were fixed at USD 22–24 thousand per day (delivery Gibraltar).

In Asia, the market remained broadly unchanged despite numerous fixtures concluded during the middle of the week. Australia and the North Pacific continued to generate most of the activity, whereas Southeast Asia suffered from a shortage of available cargoes. Round voyage rates within Southeast Asia and the Far East were reported at USD 16–18 thousand per day (delivery Far East).

Ultramax

In Southeast Asia, the market softened as support from both Indonesia and Australia remained limited. Freight rates for Ultramaxes trading between Southeast Asia and the Far East were assessed at USD 16–17.5 thousand per day.

Further north, the Far East market remained balanced, although owners showed a clear preference for backhaul employment. Ultramax rates for NOPAC round voyages stood at USD 17–18.5 thousand per day, while voyages to India achieved USD 20.5–22 thousand per day and backhaul voyages to the Atlantic were concluded at USD 16.5–18 thousand per day.

In the Arabian Gulf and West Coast India, uncertainty continued to overshadow market sentiment, making future developments difficult to predict. As a result, an increasing number of owners remained reluctant to position their vessels into the region. Rates for voyages to the Far East were reported at USD 14.5–16 thousand per day (delivery WCI).

Across the Atlantic—and particularly in the U.S. Gulf—the market strengthened, with freight rates moving higher. Given the healthy cargo programme extending through the end of July, expectations remain positive for the coming days. Ultramax rates for transatlantic voyages were assessed at USD 31.5–33 thousand per day, while voyages to Asia achieved USD 34.5–36 thousand per day.

The ECSA market ended the week with little overall change. Voyages to Asia continued to attract the strongest interest, while vessel availability remained relatively tight. Freight rates to Southeast Asia and China stood at USD 35.5–37 thousand per day, whereas transatlantic voyages to the Mediterranean and Europe were fixed at USD 33.5–35 thousand per day.

The European market opened the week quietly, offering owners only limited opportunities. As the week progressed, however, activity gradually improved, supported by fresh cargoes and an increasing number of fixtures, particularly from the Baltic. Local round voyage rates ranged between USD 20.5–22 thousand per day, scrap cargoes to the Mediterranean paid USD 26.5–28 thousand per day, while voyages to Asia were fixed at the same USD 26.5–28 thousand per day.

The Mediterranean market also strengthened as the list of prompt vessels gradually shortened and fresh cargoes entered the market. Indicatively, an Ultramax loading in the Mediterranean achieved USD 26–27.5 thousand per day for a voyage to Asia (delivery Canakkale), USD 14–15.5 thousand per day for a transatlantic voyage, and USD 17.5–19 thousand per day for intra-Mediterranean employment (excluding war-risk areas).

Handysize

In Europe, trading remained subdued, with sporadic demand proving insufficient to absorb the available tonnage across the region. Rates for the larger Handysize vessels were assessed at USD 13.5–15 thousand per day for local round voyages, USD 15.5–17 thousand per day for scrap cargoes to the Mediterranean, and USD 8–9.5 thousand per day for transatlantic voyages.

The Mediterranean developed at two distinct speeds. The Eastern Mediterranean and the Black Sea enjoyed firmer demand, while the Western Mediterranean remained under pressure. Rates for the larger Handysize vessels (above 36,000 dwt) stood at USD 11–12.5 thousand per day for intra-Mediterranean voyages, USD 10.5–12 thousand per day for voyages to Europe, USD 9–10.5 thousand per day for transatlantic business, and USD 14.5–16 thousand per day for voyages to Asia, basis delivery Canakkale.

The U.S. Gulf remained an active market throughout the week, supported by stronger demand for transatlantic business and a higher number of concluded fixtures. Rates for the larger Handysize vessels reached USD 20–21.5 thousand per day for transatlantic voyages and USD 21.5–23 thousand per day for voyages to Asia.

The East Coast South America (ECSA) market remained relatively quiet throughout the week, with no significant changes in the balance between supply and demand. Vessel availability increased marginally as additional ships repositioned into the region. However, demand improved at a similar pace, allowing the market to remain balanced. Freight rates for transatlantic voyages to Europe and the Mediterranean stood at USD 22–23.5 thousand per day, while voyages to Asia were fixed at USD 19.5–21 thousand per day.

In Asia, the northern market remained broadly unchanged from the previous week. In the South, trading started on a weaker note and maintained the same subdued pace through to the end of the week. Further west, in the Arabian Gulf and India, activity remained limited. It is worth noting that shorter regional voyages continued to command a premium over longer-haul employment. Rates for the larger Handysize vessels were assessed at USD 16–17.5 thousand per day for round voyages in the Far East and NOPAC, USD 15.5–17 thousand per day for voyages from Southeast Asia to China, and USD 9.5–11 thousand per day for voyages from West Coast India to China.

Legal Disclaimer : This report is provided solely for general informational purposes and does not constitute investment or commercial advice. The information herein is based on sources believed to be reliable but is not guaranteed for accuracy or completeness. Any actions taken based on this content remain the sole responsibility of the reader.