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Weekly Market Report & Predictions: Handy and Ultramax Sectors 2nd May 2025

Iakovos (Jack) Archontakis

TMC Commercial Director

Handysize and Ultramax Market Overview: Navigating Uncertainty and Emerging Opportunities

The dry bulk shipping market is currently a blend of fluctuating fortunes and cautious optimism. While both the Handysize and Ultramax segments are dealing with pressures from oversupply and inconsistent demand, there are also glimpses of potential growth on the horizon. Let’s dive into the latest market developments and examine where the opportunities might lie.

Handysize Market Overview: A Battle of Patience

The Handysize market continues to face a challenging environment, with a general lack of significant upward movement across key regions. The supply-demand imbalance has put downward pressure on rates, keeping most destinations in a state of flux. Here’s a closer look at the regional dynamics:

• US Gulf and East Coast (USG/USEC): The week started with a somewhat subdued tone, as the oversupply of vessels outweighed demand, resulting in weaker rates across most routes. While the East Coast showed a slightly more favorable situation, it wasn’t enough to stem the overall downward trend. With the supply-demand equilibrium hanging precariously, it’s expected that the market will remain under pressure in the near term.
• East Coast South America (ECSA): Early in the week, demand picked up, particularly in the southern regions, which drove rates higher. However, the northern part of the region remained stable. Mid-week, the market slowed down, but the overall sentiment stayed firm. With a promising cargo list for May, the outlook remains cautiously optimistic.
• Continent: A quiet week in the Continent saw rates maintaining stable levels, although low demand hindered any potential for growth. The market is likely to continue on this flat trajectory in the coming days, with little to suggest a change in the short-term.
• Mediterranean: The Mediterranean saw another lackluster week, with a brief flurry of activity in the first half, as some fresh cargoes absorbed a small portion of available vessels. However, the majority of ships remained idle, waiting for opportunities. The West Mediterranean was particularly hit, with some vessels opting to ballast to the South Atlantic. The outlook for next week remains unenthusiastic, with no immediate signs of improvement.
• Middle East Gulf and India (MEG/India): The market in the Middle East Gulf saw a healthy level of activity for prompt cargoes. However, owners with spot vessels faced extended waiting times before loading. Despite this, rates remained stable, and there is an expectation that the market will stay firm, driven by strong demand to Bangladesh.
• Southeast Asia/Far East: Early in the week, tight capacity and Australian-origin cargoes supported rates in the southern part of the region. However, as the week progressed, cargo flow slowed, leading to a dip in rates. On the flip side, the northern part of the region saw an uptick in activity as vessels tried to cover their requirements before the upcoming holidays. With more cargoes appearing for the second half of May, the market could see more positive movement in the coming days.

Ultramax Market Overview: Searching for Traction

The Ultramax segment, much like its Handysize counterpart, has been struggling with oversupply and a lack of demand-driven momentum. However, signs of recovery are starting to emerge, albeit at a cautious pace.

• US Gulf and East Coast (USG/USEC): After a period of volatility, the market has found some stability as the dust from the USTR disruptions begins to settle. Vessels have shifted southward, and cargo availability has improved, leading to a stabilization of rates. While the rebound is promising, it will take sustained demand to drive the market into a truly bullish phase.
• East Coast South America (ECSA): The Ultramax market here moved in two distinct phases. The southern part of the region saw strong activity, with a few transatlantic shipments pushing rates up. Meanwhile, the northern part remained quieter, with fewer opportunities and limited trips to Asia. If the cargo flow remains steady, the market should maintain this positive trend in the short term.
• Continent: The Continent kicked off the week on a positive note with some fresh cargoes, but the oversupply of tonnage from previous weeks kept rates stagnant. Charterers also relied on their own fleet, adding pressure to an already weak market. With both scrap and grain cargo volumes remaining low, the market is expected to maintain its current pressures in the coming week.
• Mediterranean: The market in the Mediterranean continued to show signs of weakness, with charterers taking advantage of the lack of demand to push rates lower. Some owners explored the option of ballasting westward in search of better opportunities, but the buildup of capacity is likely to continue driving rates down. The outlook for the week ahead remains challenging.
• South Africa (SAFR): Despite a slow start due to holidays, the sentiment in South Africa remained relatively firm due to the limited number of available vessels and the strong activity in India. With India continuing to attract vessels, the market is expected to stay relatively stable with a positive bias moving into the next week.
• Middle East Gulf and India (MEG/India): The Middle East Gulf saw a noticeable increase in activity, particularly for trips to Bangladesh, which led to higher rates. On the other hand, transatlantic voyages remained less attractive. With the monsoon season on the horizon, charterers are expected to act quickly, keeping the market busy in the coming weeks.
• Southeast Asia/Far East (SE Asia/FEast): The Northern region of Southeast Asia saw softer conditions compared to the previous week, with no support from the NOPAC market. However, the Southern region benefited from steady coal shipments from Indonesia, pushing rates up. A refreshed cargo list in the north will be key to sustaining market momentum in the coming week.

Disclaimer

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