In Dry Bulk Market,International Shipping News 23/09/2016
Freight rates for large capesize dry cargo shippers on key Asian routes, which hit the highest in about a year on Wednesday, are set to climb ahead of China’s week-long National Day holiday that starts late next week, ship brokers said on Thursday.
Rates from Western Australia to China had already climbed to around $6.50 per tonne on Thursday, a Singapore-based capesize broker said.
That is about 25 cents higher than the Baltic route index level on Wednesday.
“All the miners are in, fixing ships,” the Singapore broker said.
Ship owners on Thursday were offering $13-$14 per tonne from Brazil to China, which was between 50 cents and $1.00 higher than the route index on Wednesday.
“The market can stay hot until the Golden Week holiday. I’m not sure about afterwards – I think it will cool down a bit in October,” a Shanghai-based ship broker said.
Global seaborne iron ore volumes are expect to grow by 5 percent this year, said Ralph Leszczynski, head of research at ship broker Banchero Costa in Singapore.
The global seaborne coal trade however is expected to continue to slow, with growth in Chinese coal imports this year offset by the bleak outlook for European, Japanese and South Korean imports, Leszczynski said.
The fourth quarter is typically the strongest period of the year for dry cargo shippers, while iron ore and coal are the staple cargoes for capesize bulk carriers which can carry about 170,000 tonnes of those commodities.
The slowdown comes at a time when the capesize fleet is growing despite record scrapping of older ships.
Around 75 capesize vessels totalling 14.3 million deadweight tonnes (DWT) have been delivered so far this year, while a record 72 capesize ships of 12.3 million DWT were sold for scrap in the first eight months, Leszczynski said.
“Owners would like to see 120-150 capesize vessels scrapped,” Keyur Dave, chief financial officer at Wirana Shipping Corp, said at the Marine Money ship finance conference on Wednesday.
Capesize charter rates for the Western Australia-China route climbed to $6.27 per tonne on Wednesday, the highest since Sept. 21, 2015, up from $5.07 per tonne last Wednesday.
Freight rates from Brazil to China surged to $12.57 per tonne on Wednesday, the highest since Oct. 6, 2015, from $11.25 per tonne a week earlier.
Charter rates for smaller panamax vessels for a north Pacific round-trip voyage rose to $5,700 per day on Wednesday, up from $5,499 per day the same day last week.
For smaller supramax vessels, freight rates in the Far East rose to around $7,000-$7,500 per day for coal cargoes from Indonesia to China following an uptick in charter volumes.
The Baltic Exchange’s main sea freight index soared to 903 on Wednesday from 756 last week.
Source: Reuters (Reporting by Keith Wallis; Editing by Biju Dwarakanath)
