Baltic Index Jumps 11% as Chinese Coal Demand Propels Capesizes

Jan 8 (Reuters) – The Baltic Exchange’s main sea freight index jumped about 11% to its highest in nearly three months on Friday as high Chinese coal demand drove up capesize rates.

* The Baltic dry index, which tracks rates for capesize, panamax and supramax vessels, leaped 158 points, or nearly 11%, to 1,606, its highest since Oct. 14, 2020.

* The main index was up about 17.6% for the week, its highest jump since early October last year.

* The capesize index jumped 426 points, or about 20%, to 2,548, a peak since Oct. 15, 2020.

* The index firmed about 27% this week, its best weekly performance in over three months.

* Average daily earnings for capesizes, which typically transport 150,000-tonne cargoes such as iron ore and coal, gained $3,533 to $21,131.

* China’s iron ore futures marked their first weekly gain since mid-December as steel mills and traders replenished stocks of the steelmaking ingredient ahead of the Lunar New Year holiday.

* A cold spell in China and off-season, record high demand for power across Chinese grids have caused the sharp jump in the capesize index, said Peter Sand, chief analyst for shipping association BIMCO.

* However, it is not expected to sustain as it is a very volatile segment, Sand added.

* Exceptionally cold weather has caused a huge increase in power demand in the world’s largest energy consumer.

* The panamax index rose 55 points, or 3.7%, to 1,559, its highest level since Sept. 2, 2020.

* The index rose 17.66% this week, its most since Aug. 7, 2020.

* Average daily earnings for panamaxes, which usually carry coal or grain cargoes of about 60,000 tonnes to 70,000 tonnes, gained $498 to $14,031. (Reporting by Bharat Govind Gautam in Bengaluru; Editing by Shinjini Ganguli)

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