Monday, June 15, 2020

Dry Bulk Market: Strong Iron Ore Demand Boosts Rates On 2020 High

In Dry Bulk Market,International Shipping News 15/06/2020

Capesize
The Capesize market made new highs for the year this week after strong iron ore demand to the far east continued to develop in the market. Earnings have lifted from sub operating cost levels under two weeks ago, to now having surged up to have the Capesize 5TC settling at $12,410. Long tonne mile cargoes coming from all regions of the Atlantic have looked to fill the void left in supply by sluggish Brazilian offerings. While Vale may have dialled down on output year to date, they were active in the market this week on Brazil to China activity. Voyage route C3 now sits at $14.91 and the Brazil to China timecharter C14 posts at $13,936. In the Pacific, all major iron ore charterers have been busy. Owners trading options have been increasingly plentiful for one of the first times this year so bid offer spreads have been widened, leading to some periods of inactivity and a wait for one side to blink. The West Australia to China C5 lifted from $5.473 on Monday to close out this week at $6.486.

Panamax
The Panamax market witnessed a substantial recovery this week, despite a lethargic week of activity in Asia and a complex market to call in the Atlantic – at least until midweek when the EC South America market exploded into action. Levels for Australian and NoPac round trips this week hovered around the mid $7,000’s mark for Kamsarmax tonnage, whilst Post panamax tonnage were commanding a small premium to this with active demand for the larger sized unit. South America, the main driving force in the market, came to the fore with most of the grain houses placing tonnage for end June and July load arrivals – with the headline rate of $11,000 being agreed a few times for Kamsarmax tonnage delivery Singapore. With FFA values gaining values over the week for both spot and further out months, some period activity this week included a Kamsarmax achieving $10,250 for one year’s employment.

Supramax/Ultramax
A positive week across most areas for the sector with stronger demand from the US Gulf and sustained demand from the Indian Ocean even drawing vessels from south east Asia. Period activity returned a 63,000-dwt open South Korea covering five to seven months trading redelivery worldwide at $11,000. Owners had the upper hand from the US Gulf with the demand for prompt tonnage, a 63,000-dwt fixing from here for a trip to Thailand at $15,500. From east coast south America demand and supply ratio remained balanced. From the Indian Ocean activity levels remained strong. A 63,400-dwt open Mombasa covering a trip via South Africa redelivery Pakistan at $12,000 plus $200,000 ballast bonus. Indonesian coal was still in demand. A 52,000-dwt fixing delivery CJK for a round voyage via Indonesia at $6,250. For Pacific round voyage again better levels were seen, a 60,200-dwt fixing at $8,250 for a trip delivery Busan via north Pacific redelivery Chittagong.

Handysize
More activity was reported from east coast South America this week with rates further climbing. A 36,000-dwt was fixed from south Brazil for a trip to ARAG range at $7,500 early in the week, and later a 37,000-dwt open in the same area was fixed in the $7,000s for a trip to the Baltic. Recovery signs were also reported from the US Gulf whilst the market was waiting for business to be concluded that would set a new benchmark. Otherwise, a 35,000-dwt open Iskenderun was fixed for a fronthaul trip at $10,000. A 32,000-dwt delivery north France was booked for a trip to west Mediterranean with grains at $4,500. In the Pacific, rates remained firm with cargoes in the Far East building up. A 28,000 open south Vietnam was fixed for a trip via east coast India to China at $5,000. Mid-sized vessels delivery in Australia were fixed at $8,750 for a trip to Southeast Asia and $9,000 for a trip to China.

Source: The Baltic Briefing

Asian marine fuel market recovery slows amid thin demand, ample supply

In International Shipping News 15/06/2020

Initial signs of recovery seen in the Asian marine fuel market have faded amid ample supply and slow demand with the contango structure weakening from three-month highs reached June 5, market sources said June 12.
Market structure for the benchmark Singapore Marine Fuel 0.5%S swaps had inched up from a one-month low of minus $9.80/mt on May 29 to be assessed at minus $4.75/mt on June 5 — a three-month high, S&P Global Platts data showed.
But at the end of the Platts Market on Close process on June 12, the contango deepened to minus $6.75/mt, reflecting slowing demand recovery.
“Right now, demand is flattish to slightly weaker compared to that at the end of May. Spot [bunker] sales have been reasonably steady, but the amount being sold on term this month has declined quite a bit for our company,” a Singapore-based bunker supplier said.
Negotiations for the term supply of Singapore ex-wharf Marine Fuel 0.5%S bunker fuel for July were largely inconclusive, as the market was still awaiting cues on near-term price direction amid a wide bid-offer spread.
A lack of incremental demand also weighed on the spot Singapore-delivered Marine Fuel 0.5%S bunker market. The differential between Singapore gasoil 10 ppm cargo and Singapore-delivered Marine Fuel 0.5%S bunker, which had touched a six-month high of $34.87/mt on June 9, has since narrowed to $32.78/mt June 12, Platts data showed.
A fair share of IMO-compliant marine fuel in Asia is bought and sold basis Singapore 10 ppm gasoil assessment

Source: Platts