News in English

Sprint for Panamaxes and Capes

Iakovos (Jack) Archontakis
Commercial Director TMC MARITIME CO.

Dr. Fotios –Evangelos Karlis
Maritime Executive and Consultant

The dry bulk cargo market continued its upward trend with the largest sizes showing double-digit weekly increases, pulling the general index up by almost 20%. Handies and Ultramaxes also recorded single-digit gains. Specifically, Capes rose by 17.97%, Kamsarmaxes +37.22%, Ultramaxes (63) +7.61% and Handies +2.92%, compared to the previous week. Thus, the BDI rose by 269 credits , compared to the previous week and closed at 1400 credits on Friday, March 14.
Let's see, in more detail, how the dry bulk cargo market moved last week by vessels size, starting with the CAPEs. In Asia, the continuous activity from the three main miners increased the volume of coal cargoes. Some cargoes from operators were added to these, further strengthening the market. However, some downward corrections were observed at the end of the week. The index levels on the Australia-China route (C5) closed on Friday at $10.67/tn.
In the Atlantic Basin and particularly in the south, the limited number of vessels strengthened rates, while the enrichment of the market with new cargoes offered additional support. In the north, the market was calm with few new cargoes and limited activity. The indexes on Friday reached up to $24.36/tn for trips from Brazil to China (for the C3 route), while rates from Continent to Asia closed at $43.13 K/day (for the C9 route) and Transatlantic round trips at $19.64K/day (for the C8 route).
Regarding Kamsarmaxes, in the Atlantic basin and mainly in the north the week started calmly, however the market quickly picked up speed with the North Coast of South America NCSA recording some high closes. And in the south the market moved upwards for loadings at the end of the month and the beginning of the next. Indicatively, the rates for trips from the East Coast of South America (ECSA) to the Far East reached up to $ 14-15K/day + 400-500K BB (delivery Latin America), from Continent to Asia at $ 16.5-18.5 K/day (delivery in Continent) and the round Transatlantic trips at $ 10-12 K/day (delivery in Gibraltar).
On the other hand, in Asia, rates were gaining ground day by day as Australia and the North Pacific supplied the market with new cargoes. In addition, the avoidance of Chinese vessels from approaching American ports limited the number of vessels that could make this trade and gave the opportunity to the remaining shipowners to claim higher numbers. Rates for round trips in Indonesia-Far East moved to $ 10.5-12.5K / day (delivery Far East).
For Supramaxes-Ultramaxes, in Southeast Asia the market showed upward trends with satisfactory from Indonesia to W. C. India while more support from Australia is expected in the near future. Rates for UMXs for trips between SE Asia and Far East went to 12.5-14K / day. Further north, in the Far East the market showed signs of recovery thanks to the improved North Pacific picture. There is general uncertainty due to the US trade announcements towards China. UMXs rates for round trips in the North Pacific (NOPAC) were at $12.5-14K/day, for trips to W. C. India at $13.5-15K/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 had a slow start to the week but a peak was observed in the middle mainly due to the positive course of future forecasts. At the end of the week the rates fell. Fares for UMXs to the Far East ranged between $10-11.5K/day (from Middle East Gulf (MEG) – West C. India (WCI)), for short trips between Middle East Gulf – West C. India from $8-9.5K/day and trips to the Atlantic Basin from $5.5-7K/day.
The Atlantic Basin and especially the American Gulf recorded a slight improvement with satisfactory activity which led to a slight increase in rates mainly for March cargoes. UMXs to Transatlantic trips reached up to $14-15.5K/day and to Asia from $15.5-17K/day. The ECSA region experienced a quiet week with limited new cargo volume, which was booked immediately. Cargoes to Asia were also limited. UMXs rates for trips to SE Asia-China ranged between $18-19.5K/day and for Transatlantic trips (Mediterranean/Continent) from $16.5-18K/day.
Continent moved positively, driven by scrap cargoes offering a premium. It is worth noting the tendency of Chinese ships to avoid trips to America. UMXs rates for round-local trips moved at $ 10.5-12K/day, for trips with SCRAP cargoes to the Mediterranean at $ 13.5-15K/day and to Asia at $ 14-15.5K/day. The Mediterranean showed calm with rates remaining at the same level compared to the previous week. It is worth noting that the western side showed a better picture compared to the eastern side. 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 increased with fewer vessels in the region and an increasing number of cargoes. Thus, closings were recorded at a better level compared to the previous period. Rates for the largest vessels in the category, for round trips, reached up to $ 11.5-13K/day, to the Mediterranean with scrap cargoes at $ 12.5-14K/day and for Transatlantic trips at $ 9.5-11K/day.
The Mediterranean declined both due to the lack of grain from the Black Sea and because Chinese vessels avoided trips to the other side of the Atlantic Basin, thus limiting their options. The rates of larger vessels (over 36K tons DWT) for trips within the Mediterranean moved to $ 5-6.5K/day (delivery in Canakkale), to Continent to $ 5.5-7K/day (delivery in Canakkale), to the other side of the Atlantic Basin to $ 7-8.5K/day (delivery in Canakkale) and to Asia to $ 7.5-9K/day.
On the other side of the Atlantic Basin, in the American Gulf, the market was active with a large number of closures. However, the number of vessels outweighed the number of cargoes. In addition, trade frictions between China and America have created a climate of uncertainty. Indicatively, the rates of the largest vessels in the category for trips to the other side of the Atlantic ranged at $ 10-11.5K/day and to Asia at $ 12.5-14K/day.
The East Coast of South America (ECSA) region was pressured by the ever-increasing number of vessels heading to the region with the greatest burden being borne by the north. Thus, the rates of the largest vessels from the ECSA region for Transatlantic trips (Continent-Mediterranean) ranged at $ 13.5-15K/day and to Asia at $ 12.5-14K/day.
In Asia, improvements were observed with a steady flow of cargo both north and south, while capacity supply remained limited. It should be noted that especially in the south there was interest in the larger vessels in the sector, resulting in pressure on the smaller ones. Further west in the Middle East Gulf and W.C. India, the Holi Festival and Ramadan slowed down activity. Rates for the largest vessels in the category for round trips in the Far East and NOPAC closed at $ 9-10.5K / day, from SE Asia to China at $ 8.5-10K / day and from West C. India to China at $ 6.5-8K / day.

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