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THE FREIGHT MARKET’S DIVIDING LINE: FIRM RATES, SELECTIVE OPPORTUNITIES

By Iakovos (Jack) Archontakis
Senior Maritime Strategy Consultant – Chartering Executive & TMC Shipping Commercial Director

Ultramax & Handysize | Week ending 16 October 2026

The dry bulk market closed the week on a firm but increasingly selective footing, with tight prompt tonnage and sustained cargo demand supporting the South Atlantic, Far East and selected Indian Ocean routes, while weaker paper sentiment, limited fresh enquiry and growing vessel availability elsewhere began to restrain further gains. The distinction is becoming clearer between markets where cargo flow is actively absorbing supply and those where owners are relying principally on favourable positioning and firm rate ideas. The former should retain greater pricing power through October, while November will depend on whether fresh demand can absorb available tonnage without a material increase in supply. Uncertainty around the Strait of Hormuz continues to influence routing, risk appetite and employment decisions, reinforcing a market that remains fundamentally firm but offers no guarantee of a uniform advance.

SOUTH ATLANTIC — A TIGHTER TIDE LIFTS HANDYSIZE

Ultramax: Conditions remained broadly flat but with a firm undertone, as fronthaul activity recovered modestly from the previous week, fixtures exceeded expectations and a reduction in outstanding cargoes lent support. Transatlantic business held at healthy levels, manageable tonnage availability allowed owners to defend their ideas, and West Africa remained largely unchanged across both routes.

Handysize: Momentum gathered pace as limited prompt supply forced charterers to compete for the same vessels capable of meeting end-October cancelling dates, lifting transatlantic earnings to yearly highs, with large eco Handies commanding the low USD 30,000s APS. Short-period interest in the low USD 20,000s DOP South Brazil suggests some participants expect strength to persist through year-end, while the first 1–10 November requirements, spanning transatlantic, West Coast South America and fronthaul employment, emerged by midweek and reinforced the near-term outlook. The counterweight is the weakening paper market, where Panamax values corrected notably from the start of the week; whether that weakness reaches smaller sizes as November advances remains uncertain.

USGULF- POSITIONING MATTERS MORE THAN MOMENTUM

Ultramax: Limited replenishment of fronthaul cargoes left activity subdued and rates easing through the week, with most business concentrated on the US East Coast and Atlantic Colombia rather than the US Gulf itself. US East Coast–Continent trips remained in the low USD 30,000s, while Atlantic Colombia strengthened as North Brazil employment restricted available tonnage. A substantial paper-market sell-off weakened sentiment, although positional differences remain decisive and the market has repeatedly shown resilience during recent softer spells. Ultramax grain transatlantic trips, subject to redelivery, are indicated a little above USD 30,000, with fronthaul grain voyages to Singapore–Japan in the low USD 30,000s.

Handysize: After a quiet opening, additional cargoes lifted midweek activity, particularly along the US East Coast, as the tonnage list tightened gradually, bid ideas edged higher and the bid–offer spread narrowed against previous weeks.

WEST COAST SOUTH AMERICA — FIRM EARNINGS, FEWER EASY FIXTURES

Ultramax: Strong North Pacific rates and continued East Coast South America activity kept the market firm, with fronthaul and backhaul earnings near yearly highs despite relatively limited fixing volumes. Concentrate demand remained subdued, while salt opportunities persisted despite Panama Canal uncertainty. Owners stayed confident on West Coast Central America positions, although sentiment may stabilise as October requirements are covered.

Handysize: Following last week's active fixing, available tonnage tightened further and most mid-October requirements were covered, shifting attention towards late-month dates, where vessels opening later may struggle to match previously concluded levels. Strong Ultramax earnings continue to underpin Handysize sentiment, leaving the spread between the two segments unusually wide.

CONTINENT — FIRM HANDYMAX, EARLY PRESSURE ON ULTRAMAX

Ultramax: Limited fresh enquiry kept the market quiet, although bid–offer discussions increased during the week and some offers below last-done levels pointed to modest softening. End-October tonnage appears adequately supplied, but cargo availability remains limited, leaving conditions broadly steady with early pressure on rates.

Handymax: Tight tonnage and healthy demand delivered another firm week, with restricted backhaul business at USD 20,000+ and scrap employment above USD 30,000 remaining benchmarks, while period rates for good vessels held in the high USD 10,000s. Owners remain firm, but sustaining these levels will depend on whether fresh cargo flow can maintain momentum.

MEDITERRANEAN AND BLACK SEA — TWO MARKETS, TWO DIFFERENT CURRENTS

Ultramax: A healthy replenishment of demand at the start of the week, combined with progressively tighter tonnage, pushed bids and concluded rates higher, leaving the market modestly firmer as supply and demand approached balance.

Handymax: Black Sea cargoes encountered resistance in securing suitable vessels, partly because of additional costs associated with calling the area and partly because owners sought to avoid intraregional employment. East Mediterranean cargoes, particularly backhauls, were executed more smoothly and at some lower levels than in previous weeks, while the West Mediterranean benefited from large Handies covering cargoes on DOP Continent terms and, to a lesser extent, North Brazil business.

MIDDLE EAST GULF, INDIAN OCEAN AND SOUTH AFRICA — SECURITY RISK MEETS SELECTIVE DEMAND

Ultramax: Regional activity remained quiet as tonnage lists lengthened, yet rates held relatively firm as owners resisted lower ideas. Security around the Strait of Hormuz remains a material concern: reports on 13–14 October indicated continuing attacks and heightened threats to vessels operating in and around the strait, with the maritime security threat assessed as severe. Transit risks, vessel movements and operational planning remain uncertain, while Fujairah bunker prices recovered modestly after declining late last week. Oil prices and the unresolved security situation continue to restrain activity, although more owners are considering transits, including some with vessels in the Pacific seeking Middle East Gulf cargoes in the hope of securing attractive backhauls.

The Indian Ocean softened slightly week on week but remained relatively firm, with few reported fixtures and several cargoes still under discussion. Middle East Gulf–West Coast India rates held around the previous week's levels, despite fewer Fujairah and Dibba stems and slower cargo movement from Oman amid longer port waiting times. Salalah–West Coast India indications stood in the mid-USD 10,000s DOP West Coast India for Supramaxes and high USD 10,000s for Ultramaxes; one Ultramax opening West Coast India was reported fixed at USD 16,500 APS Bin Qasim on a split-rate basis, with direction West Africa.

Continued South Africa activity helped contain available tonnage, although salt exports remained limited and generally unattractive. Red Sea cargo flows towards India and Bangladesh remained healthy, with several shipments under discussion, but Supramax negotiations revealed a substantial gap between owners seeking close to USD 20,000 DOP and charterers indicating the mid-USD 10,000s. East Coast India coastal business continued to support the market, with Indonesian employment preferred by vessels positioned there. Supramaxes achieved high USD 10,000s for East Coast India–West Coast India coastal trips, while good Ultramaxes commanded the low-to-mid USD 20,000s; East Coast India–China iron ore remained a benchmark at low USD 10,000s for Supramaxes and mid USD 10,000s for Ultramaxes.

In south Afrika the week opened quietly and broadly flat, with limited activity, a couple of India-bound voyage cargoes under discussion and new manganese ore tenders beginning to emerge, although enquiry remained thin. The prompt tonnage bid–offer gap stayed wide and fixing activity limited, as owners continued to favour Far East redelivery, particularly China, potentially requiring a premium for voyages to Pakistan and West Coast India. The next few days should show whether fresh enquiry can narrow that gap. Reported Ultramax indications were USD 27,000 plus USD 270,000 gross ballast bonus for Richards Bay–Cape Town to the West Coast India/Pakistan range; USD 26,500 plus USD 265,000 gross ballast bonus for Richards Bay–Cape Town to East Coast India; around USD 26,000 plus USD 260,000 gross ballast bonus for Port Elizabeth–China; and around USD 22,000 for backhaul to the Continent. Overall sentiment weakened.

Handysize: Activity remained slow, with limited fresh Middle East Gulf enquiry, although India- and Asia-origin backhaul cargoes remained available and demand continued for box-shaped vessels suitable for steel shipments. The market lacked a fresh catalyst for improvement.

FAR EAST AND SOUTHEAST ASIA — STRONG CARGO FLOW KEEPS OWNERS IN CONTROL

Ultramax: The northern market remained firm on North Pacific and backhaul employment, with period demand also active. North Pacific–Chittagong business was consistently heard in the mid-USD 20,000s, including fixtures at USD 24,000–25,000, with a 63,000-dwt vessel at USD 25,000, a 64,000-dwt vessel at USD 24,000 and a 63,000-dwt North Pacific round at around USD 24,000. Backhaul fixtures included USD 26,500 for a Mediterranean trip, USD 24,000 for West Africa and USD 29,250 for China–Mediterranean employment. Four-to-eight-month period business stood at USD 23,500–24,000, while a 64,000-dwt vessel was reportedly fixed at USD 21,500 for one year. Steady cargo flow and limited willingness to discount allowed owners to maintain firm ideas.

The southern market was equally firm, supported by Indian and Bangladeshi demand. Indonesian coal fixtures were around USD 23,000–25,000 for Indonesia–Thailand/Philippines and Indonesia–West Coast India, while a 63,000-dwt vessel opening Davao was reported fixed at USD 29,000 for Indonesia–West Coast India coal. A 64,000-dwt vessel fixed USD 24,000 for a Whyalla–China ore voyage, while Bangladesh continued to command a premium, with a 62,000-dwt vessel at USD 31,000 for clinker to Chittagong and a 63,000-dwt vessel heard at USD 25,500 DOP for limestone to Bangladesh. Period fixtures remained in the low-to-mid USD 20,000s, with healthy Indian and Bangladeshi demand sustaining elevated owner expectations despite a measured start to the week.

Far East Handysize: The market gained momentum as Chinese activity returned to full pace after the holidays, with 33,000–38,000-dwt Handies fixing at USD 18,000–19,000 DOP for southbound trips. Prompt tonnage remained scarce as demand extended towards end-October, while outstanding mid-October requirements and additional steel cargoes could drive further strengthening next week. West Coast India employment also firmed amid continuing Middle East Gulf unrest, with owners seeking the mid-to-high USD 20,000s for single trips against charterers targeting the high USD 10,000s to low USD 20,000s; most fixtures were completed at USD 24,000–25,000. East Coast India trips stood at USD 22,000–23,000, or USD 19,000 for redelivery at Penang or Singapore, basis Singapore.

Backhaul demand remained resilient, supported by steel operators seeking larger Handies. Owner ideas were USD 21,000–22,000 for Continent trips and USD 23,000–24,000 for Mediterranean voyages, while more realistic concluded levels were in the USD 20,000s for the Continent and USD 21,000s for the Mediterranean; US Gulf trips were around USD 18,000. Owners continued to resist lower levels while seeking better opportunities as cargoes emerged, with longer-haul employment providing an alternative towards year-end. Period demand remained relatively firm across short and longer durations, particularly for modern eco larger Handies, with five-to-seven-month employment discussed at USD 20,000–21,000. Renewed enquiry after China's Golden Week improved sentiment and encouraged further period coverage, leaving quality tonnage well placed in a market expected to remain steady to firm.

Southeast Asia and Australia Handysize: The wider Handysize market continued to strengthen as prompt tonnage cleared and owners gained confidence, although Southeast Asia remained comparatively sluggish, with limited fresh spot enquiry and no consistent region-wide rise in fixing activity. Smaller Handies continued to achieve USD 13,000–14,000 per day for Pacific round voyages, with 32,000-dwt vessels earning similar levels DOP Singapore for Indonesia–Southeast Asia and Indonesia–Far East rounds. For a 38,000-dwt vessel DOP Singapore, fair value was USD 18,500–19,500 per day, while owners increasingly sought USD 20,000–21,000 on individual legs, against some remaining at USD 19,000–19,500; coastal business stood at USD 22,000–23,000 per day, with actual earnings depending heavily on position, specification and trading flexibility.

A clear two-tier market has emerged between Australia-friendly and non-Australia-friendly ships, with the latter potentially forced to discount for shorter employment to bridge the gap until their next opening rather than wait for better-paying business. Fresh steel, cement and clinker requirements into the US West Coast and Australia, together with some backhaul orders, supported larger Handies and quality loggers, but limited leg and period enquiry prevented a broad-based rate increase. Some end-October and early-November requirements have emerged, and while the wider market is firming, Southeast Asia remains slower; further gains depend on whether new cargoes tighten prompt tonnage sufficiently.

PERIOD MARKET — SPOT STRENGTH HAS YET TO WIN LONG-TERM CONVICTION

Atlantic Ultramax: The period market remained flat despite a week-on-week spot increase of around USD 600. Short- and medium-term employment continued to trade in the mid-to-high USD 20,000s, sub-delivery, but charterers remained reluctant to follow the spot market higher for longer-term cover.

Atlantic Handysize: Sentiment turned bearish, with charterers targeting around USD 16,000 for one-year periods against owners seeking USD 17,000+ to capture the benefit of spot rates around USD 18,500. The widening gap suggests that recent spot strength has yet to translate into confidence in longer-term earnings.

FORWARD OUTLOOK — THE NEXT LEG DEPENDS ON CARGO, NOT SENTIMENT

The near-term outlook remains constructive, with the strongest prospects concentrated in markets where prompt supply is tight and fresh cargoes continue to arrive, particularly South Atlantic Handysize, the Far East and selected Indian Ocean routes. Limited enquiry or increasing tonnage availability may constrain further gains in the Atlantic, on the Continent and across parts of Southeast Asia. Tight October loading windows should continue to support stronger regions, while early-November enquiry is encouraging but must develop into sustained demand rather than rely on temporary vessel shortages.

The principal downside risks remain weaker paper-market sentiment, additional tonnage moving towards North Brazil and continuing uncertainty around the Strait of Hormuz, although the impact on smaller vessel earnings is not yet clear. Period markets should remain more selective than spot, as attractive short-term employment contrasts with charterers' limited willingness to commit at elevated rates for longer durations.

The commercial distinction is between strength built on sustained cargo demand and strength created by a temporary shortage of suitable ships: the former provides a sounder basis for positioning and period commitments, while the latter calls for greater discipline over rates, duration and redelivery. As the market turns towards November, flexibility and the selection of well-positioned, commercially attractive employment will remain essential.

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This article  is provided solely for general informational purposes and does not constitute investment or commercial advice. The information herein is based on sources and reasonable assessments at the time of writing which may changed without prior notice , believed to be reliable but is not guaranteed for accuracy or completeness. Neither the author nor any affiliated parties accept any liability for any direct or indirect loss or damage arising from the use of or reliance on the content of this article. The analysis is provided strictly for informational and commentary purposes and should not be interpreted as guidance for any commercial or investment decisions.Any actions taken based on this content are the sole responsibility of the reader.