By Keith Wallis
SINGAPORE, Feb 20 (Reuters) – Rates for capesize bulk carriers on key Asian routes are set for mixed fortunes next week, with buoyancy on the Australia to China trade counterbalanced by a relatively weak Brazil to China market, ship brokers said on Thursday.
Freight rates for smaller panamax and supramax ships in Asia will also remain strong with high levels of fixture activity lending support, brokers added.
A flurry of fixtures by miners in Australia on Monday and Tuesday gave an unexpected boost to rates when they had been expected to fall, said a Singapore-based capesize broker.
“It was the busiest start to the week I’ve seen for a long time,” the broker told Reuters, pointing out 10-12 fixtures were concluded for Australia to China voyages in two days.
There was a sense that the market had “hit bottom” and the “general sentiment is still relatively positive,” the broker said.
Lack of cargoes and fixtures on the Brazil iron ore trade dampened freight rates. “There’s not an awful lot of activity,” the broker said, adding numerous ships would be free in early March, putting rates under further pressure.
Rates for the Western Australia-China route closed at $8.66 per tonne on Wednesday, up from $7.61 a week earlier, although the last done was $8.62, indicating rates could slide.
Rates for the Brazil-China route closed at $18.87 per tonne on Wednesday, down from $19.74 per tonne a week ago.
The “Atlantic suffers from thin demand and continued/growing oversupply of tonnage,” Norwegian ship broker Fearnley said in a research note on Wednesday.
“At present the only bright spot is the Australia/China coal and ore trades, being the sole reason for spot levels improving marginally,” Fearnley added.
Prospects for panamax and supramax ships are much brighter, brokers said, with charters being fixed at $2,000-$3,000 per day above Baltic index levels.
“There is no sign of anything to dampen the panamax market which historically takes a breather at this time of the year. We’re still seeing a strong volume of fixtures,” said a Singapore-based panamax broker on Thursday.
Rates for a panamax transpacific voyage closed at $11,871 per day on Wednesday, against $9,869 last week, although the last concluded fixture was higher at $12,091.
Moves by supramax owners to hold out for higher rates are also paying off with charterers forced to pay more.
“The market is very strong. The daily time charter equivalent rate is $13,000-$14,000 per day,” said a supramax broker on Thursday. This is almost $3,000 higher than the time charter equivalent rate for the Baltic’s supramax index which closed at $11,170 on Wednesday.
The Baltic Exchange’s main sea freight index closed at 1,160 on Wednesday, up from 1,085 last Wednesday.
Technical charts indicated the benchmark is expected to rise towards 1,293 as it could have bottomed.
(c) 2014 Thomson Reuters, All Rights Reserved
Join the gCaptain Club for curated content, insider opinions, and vibrant community discussions.
Join the 110,131 members that receive our newsletter.
Have a news tip? Let us know.
A Russian Navy frigate equipped with new generation hypersonic cruise missiles has conducted drills in the English Channel and is carrying out tasks in the Atlantic Ocean, Russian news agencies reported on Tuesday.
(Bloomberg) — Chinese lawmakers got a head start on the US election this week as they gathered to vote on the largest fiscal package since the pandemic. But now that...
By Dimitri Rhodes Nov 7 (Reuters) – Belgian oil tanker company CMB Tech says it will focus on the fast growing market in India as it reported third quarter results...
Access exclusive insights, engage in vibrant discussions, and gain perspectives from our CEO.
Sign Up
Maritime and offshore news trusted by our 110,131 members delivered daily straight to your inbox.
Essential news coupled with the finest maritime content sourced from across the globe.
Sign Up
Join The Club
