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HANSA spot market: Bulker sentiment turns again

Rates for capesize freighters rose again on the spot market, particularly in the Pacific. In the smaller segments, North America is proving to be a rock in the surf.

Not a bad result for the ultimate party week in shipping: the Baltic Dry Index ended trading today at 1,643 points, up 201 points on the previous week. [ds_preview]

Despite understaffed chartering desks due to the ice leg in Hamburg, there was no shortage of activity, especially in the Capesize segment. The number of freight contracts not only climbed above the level of the dismal previous week, but even exceeded the long-term average.

Mining drives bulker spot market

By yesterday evening, the British broker Braemar had already counted 29 voyage and trip fixtures in the Pacific – compared to an average of 24. The driving forces behind this were Australia’s mining companies, both on the west coast (iron ore) and on the east coast (coal). The average rate for Pacific trips subsequently rose by around 50% to over 20,000 $/day.

There was also a moderate upward trend in the North Atlantic thanks to additional cargoes and very tight tonnage availability. The rate level of the capes for time charter trips on all main routes worldwide improved by 21% to 21,473 $/day.

According to brokers, Panamax bulkers saw a solid influx of cargoes on the US East and Gulf Coasts and the North Coast of South America, with tonnage in short supply. In addition, more inquiries for Indonesia and Australia came in over the course of the week. All in all, this was enough to raise the average level (5TC) for index type vessels (82,500 tdw) by +6% to USD 13,773/day.

Panama Canal becomes a bottleneck

The market was much more difficult for smaller freighters with their own cranes. The only loading region with a clear upward trend in rates was the US Gulf and the US East Coast. The cargo supply for supramaxes and handys is still plentiful and the influx of ships is still too low for the market to ease, brokers report.

The renewed transit restrictions in the Panama Canal have not yet had any effect. It is expected that the planned halving of daily slots through the bottleneck will particularly affect the Handy to Panamax traffic in the dry sector.

Weak spot market for the Atlantic and Mediterranean

In the other regions of the Atlantic and Mediterranean, however, the rate trend was downward. As a result of the renewed firing on a bulker in Odessa, which left one dead and several injured, uncertainty about the future of the Black Sea trade continues to grow. Rates for mobile phones in the region slipped further below the USD 10,000 mark. The “Gant Yria” (37,983 tdw), built in 2016, still fetched USD 9,000/day for a trip from Constanta to Spain.

In the Pacific, pressure on rates increased again as activity slowed, with the exception of the Indonesia routes for the larger units. While the supramaxes recorded an increase of 2.2% to 12,373 $/day on a time charter average thanks to the North American effect, the handies lost -6% to around 10,700 $/day.

On the European short sea market for bulk and breakbulk, rates trended slightly downwards with little activity. The BMTI’s European Short Sea Index fell by -1.3% to 31.00 points in the middle of the week. In Northern Europe, however, delays due to storms still had a stabilizing effect on the market. (mph)

Fewer charter requests for crude oil tankers

Crude oil tankers were also unable to defend the rate levels of the previous week. According to brokers, charter demand fell significantly as a result of the market rally in recent weeks. Most inquiries in the Persian Gulf, but also in the Atlantic, were traded privately – “off market” – as brokers reported this week. This obviously enabled oil traders to take the pressure off rates. According to Clarksons, the average spot revenues of the VLCC fell by -5% to 64,700 $/day over the week. Suezmaxes and Aframaxes were down -14% and -5.5% to $60,400 and $65,200/day respectively – still very respectable levels. (mph)

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