The Capesize dry bulk market experienced challenges this week, primarily due to broader macroeconomic pressures. The escalating trade tensions between the United States and China had a significant negative impact on market sentiment, reports Baltic Exchange.
Capesize
The BCI 5TC, a time charter average of five key Capesize routes, saw a significant drop midweek before recovering slightly to close the week at $14,952, down from $16,728 at the start. This indicates volatility in the larger vessel segment, likely influencing sentiment across the dry bulk market.
In the Pacific, a longer list of available tonnage persisted. Despite some activity from key miners midweek, it wasn’t enough to prevent a decline in the C5 route rates (West Australia to China), which fell from $7.95 to around $7.20 midweek before a small recovery to close at $7.70. This suggests weaker demand relative to vessel availability in the Pacific basin.
The Atlantic market also felt downward pressure early in the week on the South Brazil and West Africa to China routes. The C3 index (Brazil to China) mirrored this weak sentiment, falling from $20.67 to $18.71 midweek. However, increased activity and rising bid levels helped it recover to $19.185 by the week’s end. The North Atlantic saw a steady flow of cargo, but softer fixtures were reported earlier in the week for Trans-Atlantic and Fronthaul routes, indicating some weakening in these key trades.
Panamax
This week in the Panamax market was significantly influenced by global macro-economic factors, leading to disruptions across various regions.
In the Atlantic, the trans-Atlantic routes experienced the most downward pressure due to minimal demand and softer oil prices. This resulted in voyage fixtures equating to timecharter equivalents that were below the index levels, indicating a weak market. The only relative bright spot was the fronthaul grain trade from the North Coast of South America (NC South America). However, even rates in this sector saw a decline as the week progressed, suggesting a general softening across the Atlantic basin.
South America experienced a quieter week overall. Deals for vessels arriving in the second half of April were consistently reported around the level of $15,250 per day plus a ballast bonus of $525,000, indicating a relatively stable but not particularly strong market in this region.
In Asia, the market was negatively impacted by a noticeable lack of inquiries from the North Pacific (NoPac), a key demand driver in this region. However, there was a mid-week improvement in demand from Australia. Rates for trips from Australia to China for 82,000-dwt vessels, with delivery in China, Korea, or Japan, hovered around the $11,500 per day mark. This suggests some pockets of demand in Asia, particularly for Australian coal and iron ore shipments to key consuming nations.
Supramax
The Supramax/Ultramax market continues to be influenced by the instability stemming from the ongoing “Tariff War,” leading to a general lack of confidence and downward pressure on rates in the Atlantic basin.
Sentiment in the Atlantic remained decidedly poor, with most routes experiencing losses. The US Gulf lacked significant fresh activity, with rumors suggesting Supramax vessels were achieving rates in the $13,000s for fronthaul voyages. The South Atlantic market was described as positional, although a fixture of a 63,000-dwt vessel from the East Coast of South America to Denmark was heard at $19,000. There was some limited activity from West Africa, with a scrubber-fitted 63,000-dwt vessel reportedly fixed to China in the mid-$13,000s.
The Asian market presented a mixed picture. Demand was observed from Indonesia, with a 64,000-dwt vessel reportedly fixed from Indonesia to the East Coast of India at $16,000. However, further north, a lack of fresh demand kept rates in check. For North Pacific (NoPac) business, a 63,000-dwt vessel open in Japan was fixed for a NoPac round voyage at $12,000. Market participants noted a significant slowdown in period chartering activity, as the uncertain future outlook continued to dampen confidence in longer-term commitments.
Did you subscribe to our daily Newsletter?
It’s Free Click here to Subscribe!
Source: Baltic Exchange
