The Capesize dry bulk market indeed experienced a significant rebound and strong upward trajectory during the week, largely driven by improving fundamentals across multiple key regions. This positive momentum was a welcome development following some recent volatility, reports Baltic Exchange.
Capesize
The Capesize dry bulk market saw a strong upward trend this past week, driven by robust demand and tightening tonnage in both the Pacific and Atlantic basins.
The BCI 5TC (Baltic Capesize Index 5 Time Charter Average), a key indicator for Capesize vessel earnings across five major routes, rose steadily from $19,071 on Monday to $23,572 by week’s end.
- Pacific Market (C5 rates): Rates in the Pacific for the C5 route (likely West Australia to China) climbed from below $9.00 to the $10.40-$10.50 range. This increase was attributed to limited vessel availability, strong demand for iron ore, and heightened activity from major miners and operators.
- South Brazil and West Africa to China (C3 markets): These markets gained significant traction midweek. The consistent presence of Vale (a major Brazilian mining company) and a tightening list of “ballasters” (vessels sailing empty to a loading port) supported this rise, lifting rates from the low $21s to the mid $24s.
- North Atlantic: After an initially quiet start, the North Atlantic market gained momentum midweek. Firming trans-Atlantic and East Coast Canada to China fixtures boosted both sentiment and rates, indicating increased demand for Capesize vessels in this region.
Panamax
The Panamax dry bulk market concluded a notably active week with solid gains, primarily propelled by a resurgence of strength in the Atlantic basin.
Atlantic Market Performance: The North Atlantic spearheaded the charge, experiencing significant rate improvements. This was further supported by activity from South America. A tightening tonnage list observed mid-week bolstered sentiment, with fixtures reflecting the firmer tone. Examples include:
- An 82,000-dwt vessel fixed for delivery to Gibraltar for a trip via North Coast South America, with redelivery in the Gibraltar-Barcelona range, at $11,000.
- Another 82,000-dwt vessel fixed for delivery East Coast India for an East Coast South America fronthaul at $13,000.
Asian Market Dynamics: In Asia, the week presented a more mixed picture. The strong pull from East Coast South America helped to reinforce owners’ sentiment, particularly for open tonnage in Southeast Asia. However, rates for longer Pacific rounds, especially those originating from NoPac (North Pacific) and Australia, initially softened into the $8,000s before showing signs of recovery towards the end of the week.
Supramax
The Supramax and Handysize dry bulk sectors faced another challenging week, characterized by continued downward pressure on rates across both the Atlantic and Pacific regions.
Atlantic Market:
- In the Continent and Mediterranean, sentiment remained largely positional, with fixtures indicating rates hovering near previously established levels. An example includes a 57,000-dwt vessel fixed for delivery Bremen, via Kotka, to redelivery Indica via COGH (Continental European Ports, Great Britain and Hamburg Range) at $13,000.
- The South Atlantic and US Gulf continued to experience weak fundamentals, as an oversupply of tonnage persistently outpaced demand. A 64,000-dwt vessel was fixed for delivery to Montevideo around June 11-15 for a trip to redelivery at Altamira at $17,500.
Asian Market:
- The Asian market also had a sluggish week, with reduced activity primarily due to regional holidays and generally subdued sentiment. A 53,000-dwt vessel was fixed for delivery to Kandla for a trip to redelivery in Vietnam with salt at $6,500.
Overall, the Supramax and Handysize segments are grappling with an imbalance between vessel supply and cargo demand, leading to depressed rates and a cautious market outlook.
Did you subscribe to our Daily newsletter?
It’s Free! Click here to Subscribe!
Source: Baltic Exchange
