Contrary to last week where almost all dry bulk markets levelled off, freight rates evolution this week started to diverge. The Capes did not confirmed the positive outlook promised by the end of last week upturn which quickly faded, and rates declined all over the week, however everyone still believes that this should only be temporary. Surprisingly this time Panamax tonnage has taken the driving seat and thanks to a sustained activity in the Atlantic and a steady level of business in the Pacific, some rates have fetched levels not seen since the end of last year. Comments could be rather similar for Handymaxes as rates benefited from a steady flow of business in both basins and regained the ground lost during the past two weeks.
The Panamax market continued to rise throughout last week, with a lot of activity in all basins. This activity was created by a high number of prompt stems available, which is in part created by the need of steel mills to fix ships that arrive at the load-port before the end of the first quarter… and before the higher iron ore prices will be applied. But there was also other commodities, especially grain, which kept the ships busy and rates up. But considering that Capes often lead the way, it will be interesting to see if the Panamax market can sustain itself.
All markets continued to move up with a lot of cargoes everywhere. The Atlantic is particularly firm with grain and sugar stems remaining to cover. It seems anyhow that soya stems in Brazil and Argentina build up slowly, and unlike two years ago, there is a limited congestion at Paranagua. Furthermore, the drought in the region is affecting the crops and exports may suffer. The Continent/Med area sees an increased number of fertilizers and steel cargoes pushing all rates up. India remains a hot spot quickly absorbing tonnage open in the area. Large Handymaxes grabbers are being fixed in the low 30’s for short period. This being said, tonnage is available and the market seems fairly balanced. It is interesting to note that a lot of operators are now trying to relet tonnage for anything upto one year at healthy numbers. Does it denote a lack of faith in a bright future?
Source: Barry Rogliano Salles, Shipbrokers, Paris
