News in English

The Capes decreased the freight market

Iakovos (Jack) Archontakis
Commercial Director TMC MARITIME CO.

Dr. Fotios –Evangelos Karlis
Maritime Executive and Consultant

The dry bulk cargo market showed downward trends due to Capes whose losses approached 20%. On the contrary, the smaller sizes proceeded without significant differences, compared to the previous week. In detail, Capes fell by 17.8%, Kamsarmaxes -1.10%, Ultramaxes (63) +1.45% and Handies -1.05%, compared to the previous week. Thus, the BDI fell by 122 credits , compared to the previous week and closed at 1299 credits on Friday, May 9.
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 main players, the miners, may have been active, however, they closed at lower levels compared to the previous week. The index levels on the Australia-China route (C5) closed on Friday at $7.49/tn.
In the Atlantic Basin, transatlantic trips in the north showed a decrease, dragging down the other routes. On the other hand, in the south there was an increase in activity mainly for loadings in late May and early June. The indexes on Friday reached up to $18.22/tn for trips from Brazil to China (for the C3 route), while rates from Continent to Asia closed at $35.08 K/day (for the C9 route) and transatlantic round trips at $13.07K/day (for the C8 route).
Regarding Kamsarmaxes, in the Atlantic basin and particularly in the north, interest was focused on the North Coast of South America NCSA, since it supplied the market with several cargoes to Asia and the other side of the Atlantic Basin. On the contrary, the American Gulf and the South Atlantic were calmer with limited activity. Indicatively, rates for trips from the East Coast of South America (ECSA) to the Far East reached up to $ 13.5-15.5K/day (delivery Asia), from Continent to Asia at $ 18-20K/day (delivery in Continent) and the round Transatlantic trips at $ 10.5-12.5K/day (delivery in Gibraltar).
On the other hand, in Asia, a satisfactory volume of cargoes may have been observed, however, the negative image of Latin America affected the overall level of rates, which lost ground. Rates for round trips in Indonesia-Far East moved at $ 6-8K /day (delivery Far East).
For Supramaxes-Ultramaxes, in Southeast Asia the market was affected by the holidays at the beginning of the week and continued at the same sluggish pace until the end. At the same time, the number of open vessels increased, adding pressure to the market. 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 started calmly due to the various holidays. However, the return of charterers strengthened activity and demand. UMXs for round trips in the North Pacific (NOPAC) were at $10.5-12K/day, for trips to W. C. India at $13-14.5K/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 continued to move positively thanks to limited supply of vessels, while demand for cargo transportation was stable. The fact that several vessels from the east are being transferred to the region is a concern. Rates for UMXs for trips to the Far East ranged between $13.5-15K/day (from Middle East’s Gulf (MEG) – West C. India (WCI)), for short trips between Middle East’s Gulf – West C. India from $14-15.5K/day and trips to the Atlantic Basin from $12.5-14K/day.
The Atlantic Basin and especially the American Gulf showed stabilizing trends, as the decreasing supply of vessels strengthened the rate market. In addition, there was a steady flow of cargo which helped to change the climate. Rates for UMXs for Transatlantic trips reached up to $15-16.5K/day and to Asia from $16.5-18K/day. The ECSA region started the week sluggishly, with little new cargo to both Asia and the other side of the Atlantic Basin. UMXs rates for SE Asia-China trips were in the $19.5-21K/day range and for Transatlantic trips (Mediterranean/Continent) in the $21.5-23K/day range.
Continent experienced a quiet week with falling demand. However, the movement of several vessels to the south restrained further decline in rates. UMXs rates for round-local trips moved at $ 6.5-8K / day, for trips with SCRAP cargo to the Mediterranean at $ 10.5-12K / day and to Asia at $ 13.5-15K / day. The Mediterranean moved at two speeds. On the one hand, the western Mediterranean showed a steady flow of cargo while the eastern one showed a shortage. Additional support came from South America, which attracted many vessels from the western Mediterranean. Indicatively, it is reported that a UMX for a trip from the Mediterranean to Asia closed at $ 13.5-15K/day (delivery Canakkale), to the other side of the Atlantic Basin at $ 6-7.5K/day and within the Mediterranean at $ 8-9.5K/day (excluding war zones).
In the Handies market, in Continent the market progressed without any particular changes. The supply and demand balance remained in favor of charterers, maintaining the pressure on the shipowners' side. Ratesf or the largest vessels in the category, for round trips, reached up to $ 7.5-9K/day, to the Mediterranean with scrap cargo at $ 8.5-10K/day and for Transatlantic trips at $ 8-9.5K/day.
The Mediterranean progressed without any particular changes. However, more and more vessels were looking for trips from Ukraine and Russia. The rates for larger vessels (over 36K DWT) for trips within the Mediterranean were at $5.5-7K/day (delivery in Canakkale), to Continent at $6-7.5K/day (delivery in Canakkale), to the other side of the Atlantic Basin at $6-7.5K/day (delivery in Canakkale) and to Asia at $8-9.5K/day.
On the other side of the Atlantic Basin, in the American Gulf, the market showed signs of life with several new cargoes and closures. However, the concentration of capacity in the previous weeks left no room for an increase in rates. Indicatively, the rates of the largest vessels in the category for trips to the other side of the Atlantic Basin ranged between $ 8.5-10K/day and to Asia at $ 11-12.5K/day.
The East Coast of South America (ECSA) region started the week under pressure since the volume of new cargoes was limited and the oversupply of capacity was evident. In the middle of the week, activity improved without stopping the fall in rates. Thus, the rates of the largest vessels from the ECSA region for Transatlantic trips (Continent-Mediterranean) moved at $ 15-16.5K/day and to Asia at $ 14-15.5K/day.
In Asia, both in the north and in the south, the market started the week calmly due to the various holidays in the north. Thus, only a few closures surfaced and these at lower levels compared to the previous period. Only some cargoes in the south for the beginning of the other month gave a tone of optimism. Further west, the market showed a balance between supply and demand. Thus, we did not see strong differences in rates. The rates of the largest vessels in the category for round trips in the Far East and NOPAC closed at $ 8.5-10K / day, from S.E. Asia to China at $ 8.5-10K / 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