US Bans Imports From Chinese Fishing Company Citing Seafarer Welfare
By David Lawder (Reuters) – U.S. Customs and Border Protection on Friday imposed a new import ban on seafood from a Chinese fishing fleet that the agency says is using...
SINGAPORE, Aug 12 (Reuters) – Soaring imports of wheat by China and Pakistan are set to drive up freight rates for smaller dry bulk cargo ships in the next few months, Asian shipowners say.
The potential hike in wheat volumes could fuel an increase of as much as 50 per cent in the number of charters for Panamax-size ships, shipbroker figures show.
“We think there will be a positive impact on rates,” said Mats Berglund, chief executive of Hong Kong’s Pacific Basin Shipping, describing China’s need for higher imports.
China is estimated to need an extra 10 million tonnes of wheat import wheat to make up a shortfall caused by crop failures linked to the weather.
That would be in addition to the more than 3 million tonnes of wheat it was already due to import in the year to June 2014.
Pakistan is set to require up to 1 million tonnes of wheat in the year to March 2014 after domestic production was hit by several factors, including a delay in planting.
Grain shipments favour smaller Handysize, Supramax and Panamax ships, varying between 32,000 and 76,000 deadweight tonnes, rather than large Capesize vessels that are almost exclusively used to haul iron ore and coal.
One Panamax-sized cargo, equal to 66,000 tonnes, would need to be shipped every day between August 1 and December 31 if China is to import an extra 10 million tonnes of wheat this year, said Khalid Hashim, managing director of Thailand’s Precious Shipping.
By comparison, more than 50 Panamax ships, carrying grain, coal and iron ore, were chartered in July, according to figures from Clarkson Research Services, a data provider widely relied on by the global shipping industry.
Hashim, whose company operates 40 dry cargo vessels, added: “I am sure that this will have a positive impact on the (dry bulk) markets.”
Dry bulk freight rates would be buoyed by a strong North American grain harvest, Berglund added.
While the Chinese wheat crop failure “is a straw of hope for the dry bulk market, we have not seen much impact on the Handysize and Handymax vessels trading in the Pacific,” said Tan Chin Hee, executive director of Pacific Carriers, owned by the Kuok Group, which has interests in commodities, property and newspapers.
Charter rates for a 32,000 deadweight tonne Handysize ship were down to $7,867 per day on Friday, against an average of more than $8,000 per day in July, according to Clarksons data.
Thailand’s Thoresen Shipping thought freight rates would start to climb in the next two months as China-led grain demand augmented very good harvests in North America, said managing director Ian Claxton.
But Tan said the firming in bulk rates caused by increased China demand would be shortlived, as the continuing oversupply of tonnage across all bulk sectors took its toll.
Dry bulk ships equivalent to 17.8 per cent of the current dry bulk fleet are on order to be delivered between now and 2016, Clarksons data showed.
Cancelled deliveries and ship scrapping this year have cut growth of the global dry bulk fleet to 3.8 per cent from the figure of 10.4 per cent for all of last year, Clarksons said. (Editing by Clarence Fernandez)
(c) 2013 Thomson Reuters
Join the 69,427 members that receive our newsletter.
Have a news tip? Let us know.