- Dry bulk index ended February at 1,229 points, significantly lower than early 2024 but above historical averages.
- Capesize segment led gains, closing at $15,074 per day, while smaller vessel classes remained below recent peaks.
- Global crude steel production dropped 4.4% in January, impacting bulk carrier demand.
Last year, the dry bulk sector surged past 2,000 points by the end of February, marking a high not seen since 2010. In contrast, February 2025 closed at 1,229 points, with much of the first two months hovering in three-digit territory. However, this decline should be viewed in a broader historical context. Over the past 15 years, the market has rarely ended February above 1,000 points, making the current level above both the average and median for this period, according to Doric Shipbrokers.
Among vessel classes, Capesize rates climbed to $15,074 per day, the highest for the year so far, recovering from mid-February’s multi-month lows. Panamax and Supramax rates settled at $9,569 and $9,275 per day, respectively, remaining below their recent peaks. Meanwhile, Handysize vessels recovered all losses from early 2025, closing February at $9,844 per day.
Steel Production and Its Impact on Bulk Shipping
India’s steel production remained a bright spot in January, rising 6.8% year-on-year to 13.6 million tonnes. In contrast, China’s steel output fell 5.6%, while Japan and South Korea posted declines of 6.6% and 8.8%, respectively. Global crude steel production for the 69 reporting countries dropped 4.4% in January, further influencing bulk carrier demand.
India’s growing steel production has sustained demand for raw materials like iron ore and coking coal, key commodities transported by Capesize vessels. However, weakening output in other major economies signals a potential slowdown in bulk trade, adding uncertainty to the market outlook.
Outlook for the Dry Bulk Market
While February’s performance fell short of early 2024 levels, it remains above historical averages, suggesting some resilience. India’s role in supporting demand for bulk carriers is evident, but broader market conditions, including fluctuating steel production and global economic trends, will shape the sector’s trajectory in the coming months.
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Source: Breakwave Advisors
