(Bloomberg) — Earnings for the largest commodity carriers fell for a third day as vessels outnumbered cargoes after last week’s gains drew idled ships back into the market.
Daily income for Capesizes, the largest ships hauling iron ore and coal, fell 12 percent to $6,472, the largest decrease since May 24, according to the Baltic Exchange, the London-based publisher of freight rates. The decline led the Baltic Dry Index, a broader measure of raw-material shipping costs, down 2.2 percent to 1,121 points, figures showed today.
Rates are retreating after almost doubling last week. Owners that tried to lift earnings by idling their vessels are now re-entering competition for cargoes, overwhelming demand to book shipments of iron ore to China, said Jeffrey Landsberg, managing director of New York-based Commodore Research & Consulting.
“Capesize demand is pretty firm so it’s really just too many vessels being brought into the available market,” he said by phone today. “As rates rose owners began to put hidden or idle vessels back into their tonnage lists.”
Daily earnings for Panamaxes, which can hold about half as much cargo as Capesizes, rose 1.1 percent to $9,466, exchange data shows. The two smallest vessels tracked by the index, Supramaxes and Handysizes, both fell less than 1 percent to $13,527 and $10,066, respectively.
– Isaac Arnsdorf, Copyright 2012 Bloomberg