News in English

BDI is in a summer mood

Iakovos (Jack) Archontakis
Commercial Director TMC MARITIME CO.

Dr. Fotios –Evangelos Karlis
Maritime Executive and Consultant

The dry bulk cargo market declined with losses across all sizes. The largest double-digit losses were recorded in the largest sizes, Capes and Panamaxes, while the smaller sizes were marginal compared to the previous week. Specifically, Capes fell by 13.92%, Kamsarmaxes -10.55%, Ultramaxes (63) -1.93% and Handies -0.58%, compared to the previous week. Thus, the BDI fell by 239 credits, compared to the previous week and closed at 2018 credits on Friday, August 1.
Let's see, in more detail, how the dry bulk cargo market moved last week by vessel size, starting with the CAPEs. In Asia, weather conditions caused various problems in central China. However, the main route from Western Australia to China improved as the week went on. The index levels on the Australia-China route (C5) closed on Friday at $10.67/tn.
In the Atlantic Basin and particularly in the north, losses were recorded for both Asia and round Transatlantic trips. In the south, there was more stability with China-Asia trips via Brazil remaining at 24K/day. Friday’s indexes reached up to $24.19/tn for Brazil-China trips (for the C3 route), while Continent-Asia rates closed at $49.63K/day (for the C9 route) and Transatlantic round trips at $31.21K/day (for the C8 route).
Regarding Kamsarmaxes, losses were recorded in the Atlantic basin with a small volume of bookings and increasing pressure on shipowners both in the north and in the south. Indicatively, rates for trips from the East Coast of South America (ECSA) to the Far East reached up to $ 13.5-15.5 K/day (delivery Asia), from Continent to Asia at $ 23-25 K/day (delivery in Continent) and round Transatlantic trips at $ 17-19 K/day (delivery in Gibraltar).
On the other hand, in Asia the downward trends continued as both the North Pacific and Eastern Australia did not offer particular opportunities to shipowners who were forced to accept lower numbers in order to book their vessels. Roundtrip rates for Indonesia-Far East trades were at $12.5-14.5K/day (Far East delivery).
For Supramaxes-Ultramaxes, Southeast Asia continued at the same pace as last week with a steady flow of coal and clinker cargoes. UMXs rates for trades between SE Asia and the Far East went to $13.5-15K/day. Further north, in the Far East the market saw a slight increase thanks to return trips with steel cargoes. Interest in season charters also increased. UMXs for round trips in the North Pacific (NOPAC) were $13-14.5K/day, for trips to W. C. India $14.5-16K/day and for return trips to the Atlantic Basin (BH) $13.5-15K/day.
In the Middle East Gulf and West C. India the market proceeded without major fluctuations. Activity was low and there was a balance between supply and demand. UMXs for trips to the Far East were $12-13.5K/day (from Middle East’s Gulf (MEG) – West C. India (WCI)), for short trips between Middle East’s Gulf – West C. India $14.5-16K/day and for trips to the Atlantic Basin $10-11.5K/day.
In the Atlantic Basin and especially the American Gulf, the week started slowly, however, demand increased during the week for both transatlantic and Asia trips. UMXs rates for transatlantic trips reached up to $23-24.5K/day and to Asia at $25-26.5K/day. The ECSA region showed an upward trend thanks to the steady flow of cargo in the north. On the contrary, in the south, demand was limited and supplied capacity increased. UMXs rates for trips to SE Asia-China moved at $23.5-25K/day and for transatlantic trips (Mediterranean/Continent) at $21.5-23K/day.
Continent started the week with a lack of cargo and limited activity. Although the supplies capacity was reduced, it still pushed rates lower. UMXs rates for round-local trips were at $12-13.5K/day, for SCRAP trips to the Mediterranean at $15-16.5K/day and to Asia at $17.5-19K/day. The Mediterranean moved at the same levels as the previous week without any particular differences. There is also a shortage of trips that can pass the Gulf of Aden, in contrast to the other routes. Indicatively, it is reported that a UMX for a trip from the Mediterranean to Asia closed at $ 17-18.5K/day (delivery Canakkale), to the other side of the Atlantic Basin at $ 11.5-13K/day and within the Mediterranean at $ 13-14.5K/day (excluding war zones).
In the Handies market, the market in Continent declined since there were no new cargoes. Thus, many shipowners preferred to move to the other side of the Atlantic Basin. A positive point was that in this way the capacity was reduced. The rates for the largest vessels in the category, for round trips, reached up to $ 9-10.5K/day, to the Mediterranean with scrap cargo at $ 8-9.5K/day and for Transatlantic trips at $ 7-8.5K/day.
The Mediterranean improved as the week drew to a close, due to a shortage of vessels on key routes. Rates for larger vessels (over 36K DWT) for intra-Mediterranean trips were at $8.5-10K/day (delivery at Canakkale), to Continent at $8.5-10K/day (delivery at Canakkale), to the other side of the Atlantic Basin at $7.5-9K/day (delivery at Canakkale) and to Asia at $12.5-14K/day.
On the other side of the Atlantic Basin, in the American Gulf, the market remained in balance as capacity may have increased but there was enough cargo to keep rates at the same levels. Indicatively, the rates of the largest vessels in the category for trips to the other side of the Atlantic Basinranged at $ 13.5-15K/day and to Asia at $ 15.5-17K/day.
The East Coast of South America (ECSA) region moved upwards, gaining day by day despite the slow start of the week. From mid-week onwards, there was more mobility. Thus, the rates of the largest vessels from the ECSA region for Transatlantic trips (Continent-Mediterranean) moved at $ 16-17.5K/day and to Asia at $ 16.5-18K/day.
In Asia and especially in the north, the market maintained its momentum while remaining in balance. In the south, a decrease in activity was observed and readily available vessels came under pressure. Further west, in the Middle East Gulf and W. C. India, the week started with a recession. However, as the week progressed, we saw some satisfactory closings, but they were isolated and did not characterize the entire market. The rates of the largest vessels in the category for round trips to the Far East and NOPAC closed at $ 11-12.5K / day, from SE Asia to China at $ 12.5-14K / day and from West C. India to China at $ 9-10.5K / day.

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