Asia Dry Bulk-Capesize Rates Pressured Abundant Tonnage

File Image (CREDIT: AdobeStock)

Posted by Joseph Keefe

Capesize rates from Western Australia to China at
8-week high; shipowners parking ships off South Africa to stop
rates falling.

Freight rates for large capesize dry cargo vessels on key Asian
routes could remain rangebound next week as abundant tonnage puts
a ceiling on freight rates even as some owners resist attempts by
charterers to push rates lower, brokers said.

"I expect the market to take a breather. Rates have been on a
yo-yo this week," said a Singapore-based capesize broker on

Charter rates fell at the beginning of the week, but rebounded
after charterers, including Cargill and Fortescue Metals Group,
fixed ships from Brazil and Australia to China, he said.

There were around 25 capesize fixtures in the week to March 2,
compared with more than 30 in the previous week, chartering data
on the Reuters Eikon terminal showed.

"The capesize market continues to be volatile," Norwegian
shipbroker Fearnley said in a note on Wednesday.

"The Brazil to China market has been quiet, but it is not
unexpected as it is the seasonal rainy season and shippers do use
this time for maintenance," Fearnley said in the note.

Some shipowners are also resisting charterers' attempts to push
rates from Brazil to China lower by anchoring vessels off South
Africa, the Singapore broker said.

Charterers with coal cargoes from the east coast of Australia
were offering a $2 per tonne premium over iron ore cargoes from
western Australia.

But the capesize market remained overtonnaged with an abundance
of ships available for loading in March, the Singapore broker
added. That would cap any gains in rates.

Charter rates from Western Australia to China held around
eight-week highs, at $5.99 per tonne on Thursday, compared with
$6.01 per tonne a week earlier.

Freight rates for the route from Brazil to China rose to $11.42
per tonne on Wednesday, the highest since Feb. 2, against $11.05
per tonne.

Charter rates for smaller panamax vessels for a north Pacific
round-trip voyage climbed to the highest since November 2014 on
Thursday on strong cargo volumes and bullish sentiment among

Rates rose to $9,170 per day, the highest since Nov. 24, 2014,
from $7,704 the same day last week.

Rates in the Far East for supramax vessels rose by around $2,000
per day on the week, climbing to $10,500 per day for a voyage
from Indonesia to China, Fearnley said.

The Baltic Exchange's main sea freight index climbed to 904 on
Thursday from 856 last week and could rise towards a technical
resistance at 1,029 in a week.

Reporting by Keith Wallis

Mar 3, 2017

Let's block ads! (Why?)

0 replies

Leave a Reply

Want to join the discussion?
Feel free to contribute!

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.