Of course the Cape sizes are under the spotlights in such a context and rates have peaked up this week either on the spot or on the period market.
Panamaxes and Handies have been lagging behind but by the end of the week they have started to benefit from the vacuum effect of the Cape sector.
The most significant contract inked this week is probably the coa signed between Baosteel & NYK for the carriage of around 26Mt of iron ore, over a period of 12.5 years from now, between Australia and China. This contract will be served by a 230,000dwt newbuilding starting 2009, which will represent a new productivity step on this rather ³short² round trip.
The Panamax market would have marked a holiday pause as mid-July was coming but fixtures reported on Friday have shown that operators are still taking positions for the future and not in a slow motion mode. No real boiling activity has been seen on the cargo side though. The trend is now to be covered on tonnage for Q3/Q4 at today¹s value ie around US$22,750/day for a modern LME.
Unlike the Capesize sector, no long term deals have been reported so far as rates given by owners are still over US$16,000 for periods longer than three years. It is interesting to notice however that a major commodity trading company took a ³small² Panamax (70,000 dwt) for 2+1 year at US$18,000 after having fixed several ships in for one year.
Despite the index moving up over the last few days it looks as if the HandyMax market is still looking for direction. The charterers resistance seems eventually to pay up with owners facing the reality of the market.
Backhaul with West African bound cement cargoes are fixed in the mid 20’s.
China to India coal is paying in the low 20’s but the WC India is still affected by the monsoon. Consequently owners are competing for the rare orders from the area.
The Atlantic offers seemingly some discrepancies between a still firm Continent market and a dull Med. Handies from the Continent get mid teens for trips to West Africa and a tick more for trips to the MEG. West Africa is more quiet and the pressure from South America seems to ease. Overall the demand for period charter is still there though the increase in rates probably pushed the takers to postpone the decision till after the holiday season.
Source: Barry Rogliano Salles, Shipbrokers, Paris
