Iron ore developments have tended to dominate market discussions over the past fortnight especially with the merger process between Tata steel and Corus going one step forward this week, after Corus’ approval of Tata’s bid. CVRD in Brazil considers that iron ore supply and demand will only “come into balance in two or three years”, and Rio doesn’t see any short term curbing in demand. To avoid this bargaining power on the supply side China has decided to use India as a new source. Depending on the decision the Indians will take on the re-direction of iron ore to domestic steelmakers, they will weigh more or less in next year round of talks. This is supported by the figures and prospects released by the port authorities of Haldia, India which claims to have become a “hub for iron ore exports” to China.

Whilst all the Panamax routes lost ground last week, by Friday the Atlantic looked to have found stability with vessels on spot/prompt dates fixing away against fresh front haul and short period requirements. However the Pacific round voyage and backhaul underwent  quite a sharp realignment, indeed the Pacific round giving up US$2,864/ day and the backhaul US$1,622/day. Whilst there are still some early vessels looking for cargoes, there is a slightly more balanced tone to the market, but with the Coaltrans conference underway, the coming week could be rather unspectacular.

Last week, the HandyMax market did loosen up a bit although there was no indication of a downturn, along with fixtures reported which were sometimes confusing. In the Continent, we have seen a build up of prompt tonnage in the 25-35,000 dwt range, while there was a clear shortage in the Handymax/Supramax range. Handysize came well under the US$ 20,000, fixing on around US$18,000, depending on duration  and destination. In the Med, it is not clear yet whether disruptions of grain exports in the Black Sea have or will continue to disturb the market. Still, there was a decent amount of open tonnage. Ex US Gulf, tct redely Cont/Med have been reported at around US$30,000.

In the Pacific, not much change witnessed with the backhaul for Handies in the low 20’s. Indian iron ore exports are still slow and by no means able to absorb tonnage available. As a consequence, Supramaxes are being fixed in the low/mid 20’s for the usual India/China run.

Source: Barry Rogliano Salles, Shipbrokers, Paris