VLCC
VLCC has taken a turn for the worse in the week gone by, down some 10 WS points for a MEG/East run since same time last week. In the Atlantic, recently the main catalyst for an upswing the VLCC sector, their smaller sister have dominated the headlines as Suez- and Aframax rates have gone from strength to strength:However, given a chance VLCCs will put a spanner in the wheels. Even on a part cargo basis freight now supports going the V-route all things equal but thus far the fixing window is out of sync. A domino effect of fixing and failing from the USG has added to the list of ships committed to the area looking for a home. Until VLCCs come back into flavour vis a vis the smaller segments we expect more of the same short term.
Suezmax
The Atlantic Suezmax market continues to take the lead in this segment with TD20 last trading WS 140. If you look purely at the numbers, there is a case to be made that VLCCs should cap Suezmax, but on further examination, it’s obvious that the Suezmax fixing window in West Africa (15-20/11) is simply too early to be impacted by VLCC cannibalization (at least for now). The USG and wider Atlantic are following the same trajectory.
In the East, there’s a mixed bag of rates with TD23 last trading WS 75, but with possible upside simply due to sentiment spillover from the Atlantic. MEG/China on modern tonnage should trade WS 130’s for now.This is a sentiment driven market, and we envisage no downside this week.
Aframax
NORTH
In the North Sea, the start of the week has seen some outstanding end month stems being covered some fresh and some replacements mixed in with stems in the first 5 days of November. Very tight early positions have enabled the market to push up with freight rising a further 30 WS points from an already strong positions at the end of last week. The balance of the week should see the balance of the first decade November cover. We will see vessels recirculate into position, but available tonnage will remain fairly tight keeping the freight market strong.
MEDITERRANEAN
It was an energetic start to the week in the Mediterranean market with an uncharacteristically busy Monday Clearing most of the end month stems and pushing us in to first decade of November fixing dates. Rates have remained steady with little change w-o-w with TD19 in at 218.67, the same time last week showing 219.44;tonnage for the most part has been available to cover demand. Although West Mediterranean positions of late have been tighter and surged rates somewhat, we still view the market to be around 80 x WS 215 for Ceyhan-Mediterranean with a steady outlook as we move in to a 1-5/11 fixing window, where natural end month itineraries could bring stability or maybe test rates if supply continues.
Dry bulk
Capesize
We see volumes thinning for mid November C5, East Australia, South Africa, and Indian business. On C3 ex Brazil to China, volumes are scarce as miners have limited November slots left and are adopting a wait and see approach. On West Africa, there are several enquiries for mid to late November stems, but we see a lack of bids and resistance to take a ship. On a whole, market has moved downwards with diminishing optimism.
Tonnage is abundant in Far East with an uptick in ballasters. On C5, fixtures concluded at low USD 10 pmt levels. On C3, fixtures concluded at high USD 24 pmt levels for late November stems with operators. One known fixture of a 210k dwt 2023-build non scrubber for 18 to 21 months at USD 23,000 per day.
Panamax
The Panamax market reveals a significant fleet positioned West of Suez, hinting at a potential upturn if Pacific demand rises. The Pacific activity increased slightly over the week; while coal demand is robust, supply issues persist in Indonesia. Asia presents an unpredictable market with a notable bid/offer spread. The Atlantic reports modest gains in the south, while the north lags. The week in the Atlantic started slowly, dominated by grain, and the North Atlantic shows reduced activity with widening rate disparities. The ECSA remains stable, with the 10-20 November window emerging as a hot spot with notable rates. Overall, the sentiment leans towards optimism despite the slow pace.
Supramax
The geared market had a slow start this week with activity picking up early today and lots of cargoes coming out of the Pacific and the Atlantic alike.
As for Handysizes, vessels being fixed at USD 10,000 levels for SP. EC India-Far East runs fetching around USD 9k levels and in the Atlantic (Brazil-Med/MEG) around low-mid 20ks. On the Supra/Ultra segment, owners asking in the range of USD 13k/11k for about 1 year. Indonesia-India Supra runs going around 10k levels and Indonesia-China runs seen mid 15k’s this week. The FFA markets have been flat this week starting with a correction seen today, however expect market to remain in the high until end of last quarter 2023!
Gas
Chartering
EAST
A widened arbitrage between US and Far East has pulled up the West market which has had a spillover effect on the East. The robust West market has been leading ships away from the Middle East in view of longer voyages and stronger earnings. As second half November fixing in the MEG is well underway charterers are faced with a tighter market and fewer competitive offers than we saw earlier last week. Looking at the balance of November we are now fixing far out and as such there may be additional candidates appearing later on but in conclusion consensus seems to agree that the market is again pointing upwards.
WEST
Western freight rates are on the rise with last done at mid 190s H/C after starting the week around 180. We have already seen plenty of fixing this week for both November and December dates counting almost a dozen deals. At the time of writing, we see several uncovered cargoes out there and with the arb still wide in addition to increased waiting in Panama we can expect todays strong freight to stay put.
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