- Baltic indices held mostly flat over the past week, with Handysize the only segment posting consecutive daily gains amid neutral overall momentum.
- Panamax trade saw only modest support despite seasonal grain exports from East Coast South America, as China’s April soybean imports hit a decade low.
- Robust agricultural flows have been offset by a sharp drop in China’s coal arrivals, sending ballasters to the Atlantic and capping freight-rate upside.
In the wake of a tentative US–China trade truce, the dry bulk sector remains driven by immediate cargo imbalances rather than broader geopolitical shifts. Over the past week, most Baltic indices meandered without clear direction: Capesize failed to sustain its late-week lift, Supramax lingered within its mid-April range, and only Handysize managed daily advances across five straight sessions.
Tepid Panamax Grain Rush
April and May usually bring a surge in grain shipments from East Coast South America, powering the Baltic Panamax P6_82 index ahead. Yet this year’s seasonal peak fell short: China’s soybean imports from Brazil plunged 22.2% to 4.60 Mt—the lowest April intake since 2015—and US volumes dropped 43.7% to 1.38 Mt. Total April imports of 6.08 Mt and a 42.5% year-on-year drop in early-season Brazilian arrivals kept Panamax demand muted.
Brazilian Export Rebound vs. Freight Stagnation
Despite a 4% annual rise in Brazil’s April soybean exports to 15 Mt (its second-highest April ever), and forecasts for record 2024/25 season exports of 108.3 Mt, the Panamax index has barely budged. Accelerated May export projections—14.27 Mt versus April’s 13.48 Mt—underscore the disconnect between buoyant cargo volumes and flat freight rates.
Coal Trade Contraction Weighs Heavily
China’s total coal imports tumbled 16% in April, with key suppliers Indonesia down 20%, Russia down 13%, and thermal coal off 17.5% year-on-year. As domestic coal output rose 3.8% to 389.31 Mt in April, an influx of empty tonnage heading west has suppressed Atlantic freight rates, counterbalancing strength in agricultural corridors.
Market Implications
The dry bulk market’s current stalemate reflects a split in commodity flows: vigorous agricultural exports are offset by a downturn in coal demand. Until one of these trends decisively dominates, Baltic indices are likely to track sideways, mirroring the tug-of-war between short-term supply–demand realities.
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Source: Breakwave Advisors
