Bulker Freight Market Overview (27 November 2020)

Stormy watersSome fresh business for the Capesizes shows up and iron ore voyages out of West Australia are rated again above US$ 7/mt while Brazilian loading can currently be concluded in the mid US$ 13s/mt. Coal cargoes of some 160,000mt from Colombia are talked in the high US$ 7s/mt and further firming when heading to ARA. The trans-Atlantic as well as the Pacific rounds have seen gains of around US$ 400-500 in one day with probably some more improvement possible.

A flurry of fresh shipments brightens the future prospect for the Panamaxes at the moment with spot freight increasing slowly but at a steady pace. Indonesian coal is shipped to China and India and grain is pouring out of ECSA. A younger 82,000 dwt has been talked at about US$ 12,000 daily for a coal trip from West Australia redelivery Japan. And same commodity is rumoured at about US$ 11.50/mt for 75,000mt for mid December loading USEC and destination ARAG. Tonnage in the North Atlantic is a bit tight putting some pressure on freights.

An interesting stream of shipments makes the market for the smaller sizes rather lively. From the US Gulf a 5-year old 63,000 dwt saw an APS freight rate of around US$ 18,000 daily for a trip towards ARA and a Supra is rumoured to have been done at some US$ 24,000 per day for an inter-Continent trip. Small Handysizes are talked in the range of US$ 14,000 daily for shipments out of ECSA heading to the Continent. In the Far East the situation remains encouraging and owners are pushing freight rates higher with the Pacific rounds talked in the mid US$ 9,000s daily with delivery in North China.

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Handy Bulk Update (25 November 2020)

handymax bulkerThe chartering market is looking still very promising. Even in the East demand for tonnage is intensifying. Off the Continent Ultra tonnage was bid US$ 24,000 daily for a trip via Baltic to Singapore-Japan range, which the owners turned down being the wrong direction. Handy tonnage of 35,000dwt was talked at US$ 18,500 daily for a trip to West Africa. From the Mediterranean a 30,000dwt was rumoured done from East Med to South Span in the low US$ 9,000 daily. Grain charterers were seeing US$ 21/mt for 25,000mt to Tunisia. Coal charterers quoting 45,000mt to South France at US$ 10/mt, based on a very slow discharge rate. Rates are moving upwards from West Africa where Supra tonnage is fixable at around US$ 21,000 daily for a trip to the East, whilst rates keep inching forward.

ECSA is also generating nice numbers for the owners, with Ultra tonnage rated by charterers at US$15,000 daily for a trip to Continent/Med versus owners’ rate of US$ 18-19,000 daily. Handies are doing very well, with a 37,000dwt fixed at US$ 17,000 daily for 3 months trading with delivery in South Brazil. Another 37,000dwt was bid US$ 13,000 daily for a trip from Plate to North Brazil. To cover a trip from Plate to Yemen can cost charterers dearly – roughly US$ 12,500-13,500 daily on a 31,000dwt ex West Africa.

Good news for the owners is also reported from the US Gulf where 34,000dwt was bid US$ 15,500 daily for a trip from EC Mexico via Mississippi River back to East Coast Mexico. A couple of orders have been quoted from South Africa without yet seeing numbers exchanged. But from Red Sea fertilizer charterers were aghast at the US$ 11,000 daily they were seeing on tonnage of 35,000dwt with dely WC India.

The East is getting short of early Handysize vessels. The owner of a 35,000dwt – after rejecting US$ 7,000 daily for a trip from EC India to China, which he thought should be worth US$ 8,500 daily, found a taker after all at this level for an Australian r/v .Ultra owners were seeing US$ 11,500 daily from CJK to India

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Bulker Freight Market Overview (19 Nov 2020)

capesize vesselPacific Capesizes seem to be splitting away from their Atlantic counterparts as eastern-based freights are looking altogether more positive while the west­ern rates remain in free-fall. West Australian voyages to China are turning around, moving from the US$ 6.5/mt area toward US$ 6.7/mt at midweek and suggesting further improvements based on current sentiment. Likewise, trans-Pacific RVs are some US$ 600 higher than the previous session to close in the middle US$ 13,000s area. Improving interest in late month dates in the East is prompting a minor up­ward correction in Pacific rates (even if it is not an all-out recovery). Front haul time charters, mean­while, continue to plummet, losing some US$ 1,500 to slide to US$ 24,000 on the assessment (likely to suffer further losses before the week is through).

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Short Sea Rates Enjoy Upward Correction (03 Nov 2020)

short sea shipA virtuous cycle of increased cargo ordering spurred by tightening avails, thus spurring more ordering (and so on), has taken over in the northern trades, brokers agree, with rates seeing more upward movement in recent weeks than they have all year, letting October take its traditional role as one of the most—if not the most—bullish months of the year. Freights are moving so quickly to new highs that they are likely to return to year-ago levels by the beginning of November, which would be an impressive recovery to close out an altogether disappointing year. The year is, of course, hardly over, but owners hold hope that it will maintain its positive trajectory for at least the duration of November as freights return to their “true” market level and upward corrections continue apace. Rates ex-ARAG to WCUK (3,000mt general cargoes) have continued to fluctuate over October in the low teens of EUR 11-12/mt with rates already rumoured to have reached EUR 13-14/mt for early November positions. Eastbound traffic from ECUK to the Baltic States is hitting the mid-high teens of EUR 15-16/mt, brokers say, while the reverse from the Baltic States to ARAG has long since surpassed EUR 20/mt to start trading in the low EUR 20s/mt.

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Handy Bulk Update (23 October 2020)

Handysize bulkerOn the Handy sector tonnage open on the North Continent remains very tight and rate firm. A 37,000 dwt fixed delivery passing Skaw for a trip via Baltic redelivery Morocco with grains at US$ 17,250 per day and a 39,000 dwt open in Belfast secured US$ 15,000 daily for a trip via North Continent redelivery US Gulf. A 33,000 dwt open in East Med fixed in the high US$ 12,000s per day for a trip with bagged cement to Jamaica. For a trip Black Sea to Baltic a 34,000 dwt managed US$ 13,500 per day with grains and for a trip Black Sea to Italy and a 28,000 dwt built 1998 fixed at US$ 12,250 daily delivery Canakkale. In contrast the US Gulf continues softer and a 33,000 dwt was heard to negotiating circa US$ 11,000 daily for a trip to Brazil and a 30,000 dwt was rumoured to have fixed a trip aps SW Pass to NCSA at US$ 12,250 per day. In the Pacific rates appear steady. A 37,000 dwt was heard fixing at US$ 7,000 daily delivery CJK for a trip to PG. On the larger Handymaxes a 45,000 dwt open in CJK fixed at US$ 7,000 per day for a trip via Indonesia redelivery China. From the North an older 28,000 dwt fixed steels to SE Asia circa US$ 6,000 per day.

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Bulker Freight Market Overview (21 October 2020)

PanamaxThe Panamax sector continues to see a divergence between Pacific and Atlantic. The Pacific is witnessing an improved tonnage profile in the South and with more cargo hitting the market some brokers see the market pushing up with a tight supply on the prompt position. More enquiry being seen out of Australia (though very little is seen heading to China). Good specification Kamsarmaxes are seeing bids around the US$ 13,000 daily mark versus mid US$ 13,000s per day delivery CJK via Australia redelivery India with standard Kamsarmaxes more like US$ 12,000 daily. Out of Indonesia LME Panamaxes are fixing around US$ 10,000 per day with delivery South China via Indonesia redelivery India and an 82,000 dwt built 2020 was heard to have fixed delivery South China via Indonesia redelivery China at US$ 13,750 per day. In the North the NoPac continues to provide a steady cargo flow which is keeping charterers honest, an 82,000 dwt built 2020 fixed a NoPac round at US$ 12,700 daily basis delivery CJK. In the Atlantic the North Continent remains quiet and levels keep dropping as charterers rate check then look to cover with own tonnage, charterers are bidding US$ 10-10,500 per day for quick rounds on standard Kamsarmaxes. Out of the US Gulf there is a bit of a stand-off as charterers drop their bids and owners reluctant to chase although the charterers appear to have the upper hand. ECSA is also lacking early enquiry, on the forward position a 75,000 dwt built 2008 was heard to have fixed US$13,500 daily + US$ 350,000 BB for a fronthaul delivery aps ECSA 15/20 Nov.

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Bulker Market Overview (13 Oct 2020)

bulkerEver the size class ruled by sentiment rather than physical trading, Capesize freights slide further and more sharply than in days past with an average of US$ 2,000 lost on long hauls and more than US$ 3,000 lost on trans-Atlantic RVs in one of the more damaging sessions in recent weeks. It remains to be seen if these losses will be arrested, continued or worsened as the week goes on, but for now it seems the market is very much swaying in favour of char­terers until cargoes finally return to the spot market.

Trends remain lightly buoyant for Panamaxes with owners holding onto the slightest advantage in ne­gotiations on Atlantic delivery freights. Trans-Atlan­tic RVs continue trading in the US$ 14-15,000 daily range with charterers seemingly willing to throw in the extra US$ 100 if absolutely necessary. Pacific-based business is steady if stagnant. NoPac rounds are flat at US$ 12,000 on 76,000 dwt as witness by a recent fixture open Zhoushan. Coal voyages have se­cured US$ 14.6/mt on 75,000mt Gladstone/Vizag.

Steady sailing for Handy bulk as the week begins with little change noted in either direction and prin­cipals that do secure business happy to accept last-done rather than argue the finer points. Trans-At­lantic trips are consistently fixing mid US$ 13,000s on 38-42,000 dwt vessels with US$ 14,000s com­mon on the larger 52,000 dwt-and-up ships. North­bound trips from Southeast Asia into NoPac are still getting US$ 9,000s on 36,000 dwt, but some own­ers of 42,000 dwt ships report seeing US$ 10,000s.

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Freights Firming in Baltic Short Sea (25 Sep 2020)

short sea shipFor the first time in quite some time, tonnage seems to be tightening in the Baltic Sea markets, giving owners just enough leverage to seek higher-than-last freight levels and suggesting the possibility of a modest freight recovery on the verge of the fourth quarter of the year. With freights have traded at such low levels for so long, however, even the mildest of activity improvements is bound to trigger a recovery of sorts, but firming sentiment is nonetheless big news for a sector long under the spell of sluggish chartering demand. Southbound freights from the German Baltic into the Turkish Med have seen levels just under US$40/mt with at least one owner claiming to have reached that psychologically-important barrier already. Eastbound trips from WCUK to the German Baltic on general cargoes of 3,000mt have been observed at upwards of US$ 13/mt while the same is likely to secure around US$ 11-12/mt from ECUK. Further, westward-bound rates to ECUK are looking at upwards of US$ 12.5/mt and US$ 19.5/ mt from ARAG and the Baltic States, respectively. Northbound freights to the Irish Sea are seeing some buoyancy over last-done, too, with at least one fixture ex-ARAG heard to have secured US$ 15/mt on 5,000mt or US$ 0.5/mt up from early September.

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BMTI Dry Bulk Commodity Update (21 Sep 2020)

EU sugarThe EU is facing the prospect of a considerable de­cline in sugar production in 2020 after enduring a combination of extensive damage to its crop by pests and generally extensive, unfavourable weather con­ditions throughout the first half of the year. Current estimates have sugar output in the EU and Britain falling to 16.1 Mt this year from 17 Mt last year, due primarily to poor sugar beet output numbers from France. French crops are expected to produce around 15% lower than the five-year average amount this year, according to analysts at CGB.

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Bulker Freight Market Update (10 Sep 2020)

handymax bulkerAs the last Australian reporters leave China, diplo­matic tensions continue to rise between Canberra and Beijing. Whether China is ready to put tariffs on Australian iron ore imports remains unlikely, while still not as remote an idea as previously thought. The continued firmness of the iron ore price suggests the political reality is being factored in with no easy resolution in sight. For the Capesizes, it has been a quiet, nervous start to the week. In the Pacific, fix­tures on the West Australia to Qingdao run continue to slip and rates are now rumoured to have been concluded at below US$ 7/mt for end-September laycan. There is also a lack of activity on the Atlantic trans-Atlantic markets and front haul bids for Tu­barao/Qingdao voyages are heard to be down to around the US$ 16/mt mark with plenty of ballast­ers remaining unfixed. The outlook is negative.

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BMTI Handy Bulk Update (3 Sep 2020)

ultramax bulk carrierConsistent inconsistency remains the major feature of the chartering market and is quite an impediment to strike a safe trade deal. The rates given as part of the sales price could well decide the difference of loss or profit of the deal. Grain charterers are feeling the pinch. Trading margins are slim. To make US$ 5/mt profit sounds like a miracle. US$ 1/mt profit is  not unusual, and the profit is extremely exposed to the whims of the chartering market. Thus, small trading houses prefer to do FOB deals, to secure the small available profit at least. Furthermore, there is a growing tendency to escape from the US currency and find other means of financing the trade deals. Slow activity and lower rates seems to new reality, thus criss-crossing owners’ ambitious goals of last week to enhance their scope for rising rate levels.

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Coaster Owns See ‘Unsustainable’ Freight Situation (27 Aug 2020)

short sea shipWith the ongoing economic malaise across Europe and the corona-related cargo demand shock still holding freights to historically low levels, owners continue to struggle to find new business in the Baltic and North Sea trades. Freights remain rela­tively unchanged as they have since the start of the month following a brief surge in demand on the monthly switchover. Southbound freights from EC­UK and ARAG into North France remain at about €18/mt on general cargoes while eastbound rates from WCUK to ARAG are holding to €10/mt at best with single digits of €9/mt (and even lower) more likely for general cargoes. Single digit cargoes have also been seen on aggregate ship­ments in the North-South Baltic trade via Norway. Northbound shipments ex-N.France to the German Baltic have seen even more pressure in recent weeks with some owners have relented to €10/mt on 5,000mt cargoes whereas they would have pushed for nearly double that level at the start of the year. Westward Baltic rates from Balticum to ARAG are flat in the mid teens with some volatility seen be­tween owner and charterer offers by as much as €17/mt from the former versus €13/mt from the latter. Owners say that the current situation is not sustainable but have only the cold comfort of com­mon cause with the rest of European shipping folk.

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BMTI Dry Bulk Commodity Update (19 Aug 2020)

wheat fieldUK wheat is bracing for one of its lowest harvests in decades, according to the National Farmers’ Union (NFU), which is forecasting perhaps the worst crop since the 1980s. “Challenging” weather conditions this year, says the union, have seen quality levels fall to their lowest in some 30 years, even as there are still several variables in play that could prove to prop up output before the harvest is completely through. Severe thunderstorms followed by an extended heatwave this year—even more severe than usual due to the compounding effects of climate change—however, has made predictions more negative than they were just a month or two ago. The NFU now says yields could fall as much as 30-35% year-on-year across the UK with some areas perhaps suf­fering even deeper declines. This would surely put the UK back to the status of net grain importer as its domestic consumption needs will most likely out­strip domestic production.

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Bulker Update by BMTI’s London Shipbroker (12 Aug 2020)

bulk carrierIt’s been a quiet start to the week for the Capesizes. Some activity on trans-Atlantic routes and a re­stricted tonnage supply have kept rates steady from the North Atlantic. On the front haul market, bro­kers heard levels being discussed out of Brazil were showing some improvement despite brokers report­ing a lengthy list of ballasters but fixture details were not forthcoming. A long weekend in Singapore has seen a slower start to the week in the Pacific. Rates appear to have softened against the backdrop of low activity but brokers remained hopeful that more en­quiry will be forthcoming later in the week, West Australia to Qingdao was heard to have fixed in the low US$ 8s/mt for end August dates.

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BMTI Handy Bulk Update (06 Aug 2020)

Handysize bulkerUltra-Supramax vessels off the Continent have been making very little progress, if any. Scrap charterers took a Supra at US$ 11,250 daily whilst Ultramax tonnage for loading Baltic for East Med is worth around US$ 12,000. The rate for a trip to S.Africa on 63,000 dwt is hovering around US$ 13,500 daily and the US$ 11,000 daily Ultra tonnage was bid for a trip to Brazil is not to be sniffed at. Also, Handysize owners want their rates to improve and are showing US$ 11,750 daily on 38,000 dwt tonnage for a trip from Rouen to Algeria. The US$ 9,000 rate on a 32,000 dwt ex-Portugal via Baltic back to Algeria seems to support that that they aren’t irredeemable dreamers.

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Dire Conditions Bedevil Black Sea & Azov Coasters (31 Aug 2020)

Black Sea mapHopes that late summer would see a return in de­layed demand throughout the Azov and Black Sea markets have so far been left unfounded. Grain pro­ducers are facing the continued paradox of higher prices countered with lower demand and, thus, con­tinued delays from otherwise dependable buyers. One Azov-based owner has identified a 60% dis­count in current rates (ex-Azov shallow ports) vs. a year ago while the same are some 50% lower than the running five-year average. This situation is clear­ly unsustainable, but owners are being forced to accept unacceptable conditions amid an unprece­dented demand shock and global shutdown. With standard Azov grain rates now merely US$ 1-2/mt higher than their inter-Black Sea counterparts, pro­fits are razor-thin if even justifying the term profit. Grains of 5,000mt (46′) can fetch about US$ 15/mt from Azov to Marmara while the same cargo is unlikely to get much higher than US$ 12-13/mt ex-Kherson to Marmara. Coal trades, while sometimes able to fill the gap of missing grain business, are largely fetching even lower levels with US$ 11/mt on 5,000mt (43′) from Rostov to the Turkish Black Sea. SBM of 3-4,000mt (56′) has been fixed for US$ 12-13/mt ex-Niko to Poti, which represents the standard kind of business that owners are typically able to secure in the Black Sea at the moment.

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Bulker Update by BMTI’s London Shipbroker (22 July 2020)

Ultramax at sunsetThe Panamax market is currently also on a downward trend. Although the tonnage supply in the Atlantic has been quite favourable over the last few weeks it seems more vessels are coming open in the next 15 days, the FFAs are on the slide and the charterers have left the building. In consequence rates have fallen away as owners reset their numbers in order to attract some attention from the charterers. In the Pacific there appeared to be more action and brokers said the cargo volume was still reasonable but it appears the tonnage count is building in key areas so we see rates coming off here too particularly out of Indonesia. That leaves owners with prompt tonnage a tricky conundrum, stay in the area at low money for a quick round or ballast west in the hope that levels here will recover. Australian business still carries a premium, hearing an 82,000 dwt built 2012 fixed delivery South Korea for an Australian round voyage around US$ 12,000 per day.

The Handy sector continues to make headway in the Atlantic. From ECSA tonnage remains tight and a decent spec 32,000 dwt was heard to have fixed with delivery South Brazil for a trip to North Continent at US$ 11,500 daily. From the US Gulf the market remains in owners’ favour and some brokers would now consider levels for a trip to North Continent-Med to be on a par with those obtainable from ECSA. A 38,000 dwt was said to have fixed a trip US Gulf to EC Mexico at US$ 12,500 per day. In the Pacific rates are steady at best. Little fresh information has emerged so far this week although a Handymax was heard to have fixed delivery Mid China for a CIS round at US$ 6,000 per day.

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Handy Bulk Market Update (17 July 2020)

handysize vesselThe chartering market is taking a breather. Hopefully it is not the end of the upward rally, although several sources think the market may have peaked. Time will tell. The present indications are certainly down. Kamsarmax owners dropped their rate for a coal cargo from USEC to India by US$ 2.25/mt from US$ 33/mt to secure the cargo. Also from Black Sea charterers were suddenly seeing lower rates than offered and thus reduced their rate by US$ 0.50/mt from US$ 8.40/mt and had no problem to find cover for a cargo to the Continent.

Scrap rates off the Continent have come off by around US$ 2,000 daily for Ultra tonnage for a trip to East Med. Handy rates are still trailing the larger vessels, with 32,000dwt done at US$ 7,750 daily for a trip to West Med. Apparently very pessimistic owners booked a Rouen/Algeria cargo at US$ 14.75/mt for August dates. Grain charterers were rating 36,000dwt at US$ 8,500 daily to cover such similar stem. US$ 8,500 daily was the rate owners of a 32,000dwt were commanding for a trip to West Africa, ending up in South Africa would push the rate up to low US$ 10,000s daily.

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Short Sea: Northern Europe Remains in Summer Lull (15 July 2020)

Ultramax at sunsetWith the summer holiday season in full bloom market participants discussing the situation with BMTI are running out of words to describe the lull presently dominating the northern short sea market. There is no sound balance between supply and demand with plenty of ships around but cargoes available not very abundant. At least spot freight rates are no longer declining as with the increasing bunker prices coaster rates have to adjust also. Some steels and ore cargoes are seen in the market with a pig iron load of 10,000mt from ARAG being concluded at some US$ 12.25/mt for a trip to Marmara. A steels shipment of 6,600mt loading in the Sea of Azov and heading to 4 ports in Northern Spain was talked at around US$ 33.5/mt and an iron ore load of 5,400mt has been discussed at about US$ 29/mt from Turkish Black Sea into ARAG region. Players advise that general cargoes of 3-4,000mt can see spot freight rates in a range of EUR 14.50-15.50/mt when delivery in mid Baltic and destination in ARAG. From ECUK shipments of some 4-5,000mt are talked at around EUR 11.50/mt at the moment. The flat demand is challenging and a change of trend is probably some more days away.

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Bulker Update by BMTI’s London Shipbroker (10 July 2020)

handymax bulkerThe Handy sector in the Atlantic is seeing better numbers overall. Midweek saw a 35,000 dwt fixing out of the US Gulf for a trip to North Continent at US$ 8,000 daily whilst a 38,000 dwt obtained mid US$ 9,000s per day for a similar trip. A 30,000 dwt open on the North Continent fixed circa US$ 7,000 daily for period redelivery Atlantic ranges. Fronthaul rates from the Black Sea for modern 38,000 dwts are around US$ 15,000 per day. Gains were also heard out of ECSA with larger types looking to fix trips with redelivery Continent-Med around US$ 12,500 daily level. In the Far East activity was subdued and rates slipping. It was rumoured a 30,000 dwt open Central China fixed high US$ 5,000s per day for a trip with steels to SE Asia.

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Bulker Update by BMTI’s London Shipbroker (8 July 2020)

panamaxCapes has seen rates falter in both the Atlantic and Pacific basins. The tonnage situation still remains relatively tight in the Atlantic but the enquiry has thinned noticeably on the fronthaul market which is now focusing on August. The bid/offer spread widened but with the Cape FFAs taking a wobble on Q3 in particular, down US$ 2,500 per day, it may have spooked the market and Tubarao/Qingdao route was heard to have fixed low US$ 21/mt for 1st half August. On the trans-Atlantic routes rates remained reasonably steady. In the Pacific the momentum appears to have swung back in the charterers’ favour for the time being with the West Australia/Qingdao route heard to be fixing around US$ 10.50-10.25/mt level. Time charter rates have also weakened.

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Handy Bulk Market Update (3 July 2020)

Having been pretty excited about the markets general performance, signs of a drawback are emerging. From ECSA grainhouses in all likelihood will use own tonnage to cover August cargoes. Also in the Pacific a downward correction for forward business is already obvious. The owners approach to business is always an indicator of imminent changes, in as much that dropping a trade because of charterers’ low rates, to which the owners return after they failed repeatedly elsewhere, and then being told that the business had gone. Coal shipments from India to China have almost disappeared since China has reached the quota. The next program is not expected before second half August.

As far as ECSA es concerned Ultra owners stand no chance to get any near towards US$ 15,000 daily plus 500,000ls for a fronthaul run, and given that demand is slowing rates will drop as a result. TA was done from North Brazil to Cont/Med at US$ 13,250 daily. Coastal charterers took a 28,000 dwt at US$ 7,750 daily. A 62,000 dwt was booked for a 3-5 months period at US$ 10,500 daily with redelivery Gib/Skaw range.

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Modest Demand Rally in Baltic Coasters (1 July 2020)

short sea ship coaster balticNorthern European coaster business—and indeed freight rates—have fallen to such lows that any mi­nor positive change in demand can be welcomed as a recovery. This seems to be the case, ironically during a historically lull period, for Baltic and North Sea-based short sea vessels. Charterers have been seeking more vessels out for July dates as lockdown con­ditions continue to ease around the Continent. There has certainly been nothing dramatic to point at, but the fact that any growth in inquiry is hap­pening makes for big news in this long slumbering sector. As such, owners are seeking premiums over last-done rates, and there are signs that next week could well see further gains as well. Trans-Baltic freights from the Baltic States to ARAG are seen fetching high teens again instead of the EUR 15/mt range general cargo freight of mid-June. Short trips between WCUK and ARAG are rumoured to have fixed EUR 10/mt on cargoes of 3,000mt compared to EUR 9/mt that was obtainable a week before. Southbound freights from Ireland to the western Med are being reported at EUR 20/mt, some EUR 2/mt higher than two weeks before. The extent and magnitude of this upswing remains to be seen, but owners are hopeful for the first time in some time.

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Bulker Update by BMTI’s London Shipbroker (23 June 2020)

panamax bulkerAfter breaking US$ 30,000 daily early last week only to hit US$ 40,000 daily by the end, Capesize front haul rates seem to be taking a breather with the week starting on low activity but high hopes. Still holding just over US$ 40,000 daily on the assessment, front hauls are rumoured to be in negotiations for the week ahead, despite the mild reversal seen in the post-weekend session. Trans-Atlantic round voyages, meanwhile, long the hardest-hit of the long hauls, remain buoyant with low US$ 24,000s climbing to mid-high US$ 24,000s on modern tonnage.

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BMTI Dry Bulk Commodity Update (17 Jun 2020)

The current commodity price rally is in danger of outrunning fundamentals, Goldman Sachs warned this week, noting that strong downside risks remain in the agricultural and energy sectors. The warning was oriented more towards oil, which the bank has called ‘to much, too fast’ while it allowed that metals markets remain ‘extremely strong’ as recent Chinese infrastructure demands have exceeded expectations. wheat field

Export prices for Russian wheat remained relatively stable in recent days even as grain prices elsewhere, notably the US, suffered bearish pressure after the USDA upgraded its outlook for global wheat pro­duction by 4.9 Mt. Black Sea-based wheat values have been less prone to decline due to ongoing con­cerns about the crop conditions in Russia. Wheat loaded from Russian Black Sea ports is trading at US$ 205/mt FOB this week, essentially unchanged from the week before. Other estimates have the price closer to US$ 206/mt, also in sideways trend. Egyp­tian state grain buyer GASC purchased 120,000mt of Russian grain last week, also buoying sentiment and reducing overall supply. Russia exported 35.6 Mt of grain in the last eleven months, 14% lower than the same time a year ago, according to SovEcon data. State stockpiles are currently at around 0.4 Mt.

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Handy Bulk Market Update (10 June 2020)

handymax bulkerTrying to analyse the worldwide chartering market, you cannot but conclude, that the East is hugely outperforming the Atlantic. This does not mean that every owner is keen to go there, and rather keep staying in the Atlantic. Were there to be a rush to the East, the pendulum after a while would be swinging back. A widely spread rush of tonnage to the East may lead to an oversupply there dragging rates down whilst in the Atlantic the reduced number of ships may spark a significant improvement of rates in the area. In any case, despite the East being the better area, premium rates are still being paid for going there, numbers nothing near obtainable in the Atlantic.

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Short Sea: Bearish Trends in Baltic Trades (2 June 2020)

short sea ship coaster balticIn keeping with the broadly bearish trends across the northern European trades, the trans-Baltic rates have been declining with more or less steady progression with the high teens of early May fading into the middle teens of end-May and owners now happy to accept €15-16/mt range freight rates on general cargoes from the Baltic States to ARAG even as other hold out for last-done rates in the €16-17/mt range. Holidays and summer sluggishness have been the usual culprit for lower cargo demand, but the systemic slowdown around the global pandemic have given nearly every single sector of the European manufacturing economy plenty of reason to justify an increasingly negative bent in momentum for the early-to-mid summer season. Owners and charter­ers—let alone market observers—have been report­ing a wide range of freight values simply because there is so much space opening between demand for ships and available tonnage. There continues to be word of northbound freights in the range of €20/mt from the Adriatic to Ireland, but even there we hear word of owners claiming to be willing to accept €18/mt or thereabouts, the sort of rate that would have been unthinkable for a voyage with half of that duration just six weeks ago. The phrase ‘new normal’ has been overused by every analyst of the shipping economy, but conditions do seem to have entered an unknown reality that require excep­tional solutions to address exceptional challenges.

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Bulker Update by BMTI’s London Shipbroker (22 May 2020)

handysizeThe Capesize recovery is welcome but not everyone is convinced. European holidays make the Atlantic picture in particular unclear although some weaker transatlantic negotiations were thought to be taking place but better rates were heard on the front haul. At midweek, Oldendorff fixed Tubarao/Qingdao at US$ 8/mt but it should be noted these improvements are taking place against the backdrop of rising bunker prices. Brent crude now stands at circa US$ 36 per barrel. In the Pacific West Australia/Qingdao is seeing decent enquiry with all the majors active and there still appears to be a shortage of early vessels that are able to comply with the Australian 14-day quarantine rule. BHP was heard to have paid US$ 4.70/mt with rumours Oldendorff paid US$ 4.80/mt and FMG rumoured fixed at US$ 4.85/mt.

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Handy Bulk Market Overview (12 May 2020)

Ultramax at sunsetCovid-19 is keeping the market under tight control and only in the East-Indian Ocean range is the virus loosening its grip. Rates seem to be improving with Ultramax tonnage fixable at US$ 6,500-7,000 daily for NoPac rounds. CIS charterers have also raised their ideas to US$ 4,500 daily on Supramax tonnage with delivery Japan via CIS to Vietnam. And from the EC India area, freight rates have increased to US$8,500-9,000 daily on tonnage of 56,000 dwt for a trip to China. An Australian round voyage was done at US$ 4,000 daily on tonnage of 32,000 dwt. As expected, rates have also gone up from South Africa with owners of a Tess 58 holding US$ 9,000 daily plus US$ 90,000 BB for front haul to China. The owners have multi­ple choices including US$ 8,000 daily plus US$ 80,000 BB to ECI. It is therefore understandable for the owners to wait and see and monitor the market.

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Russian Grain Regs Spur Black Sea Exports (05 May 2020)

wheat fieldActivity has been lagging in the Black Sea and Sea of Azov trades, but the ongoing tightening of Russian grain quotas and looming suspension in mid-May has caused a notable acceleration in forward selling and export shipments in general. Falling bunker prices are also being credited with giving owners a bit more breathing room in earnings and has given owners reason to keep the market moving sideways even as open tonnage capa­city seems to be holding to just north of breakeven. Grain shipments (5,000mt at 46′) from Rostov are fetching around US$ 19-20/mt to Marmara while the same cargo to the Egyptian Med can secure low EUR 30s/mt. Inter-Black Sea freight rates are stable.