S&P Global reports that the Supramax market in the Continent and Baltic Sea regions experienced a weak trading week. Rates declined due to limited market activity.
Sluggish Week
The dry bulk market experienced a sluggish week with low activity and weak sentiment. Despite strong fundamentals, inquiries remained low, reflecting a cautious market outlook.
A charterer described the sentiment as “clearly weak and negative,” citing tonnage oversupply in the region as a contributing factor.
The lack of fresh scrap inquiries further exacerbated the sluggish market conditions. The dry bulk market in the continent region exhibited a cautious sentiment in the second week of January, with data from S&P Global Commodities at Sea showing 93 laden ships and 48 ballasting vessels.
Despite this, the spread between laden and ballasting vessels increased from week 1 to week 2, rising by 2 vessels to 45. This widening spread indicates a potential imbalance in supply and demand, even amidst the prevailing negative market sentiment.
These observations suggest a cautious outlook for the dry bulk market in the coming weeks, with potential challenges arising from the current market dynamics.
TCE Rates Decline
The dry bulk shipping market experienced a decline in TCE rates for the Rotterdam-Aliaga 40,000 mt ferrous scrap route during the week ending January 13th.
- 0.5% Sulfur Marine Fuels: TCE rates for vessels using 0.5% sulfur marine fuels decreased by 13% to $8,311/d.
- Scrubber-Fitted Ships: TCE rates for scrubber-fitted vessels also declined by 12% to $9,384/d.
These declines indicate a challenging market environment for this specific route, with factors such as weakening demand and increased vessel supply potentially contributing to the downward pressure on rates.
The North Atlantic market experienced a period of limited activity, with no reported activity in US East Coast trans-Atlantic trades. This lack of activity, coupled with a general lack of momentum in North Atlantic and trans-Atlantic markets, has led to a decline in spot rates.
Despite the lack of significant activity, the supply of vessels in the region remained relatively balanced. Data from S&P Global Commodities at Sea showed 12 laden Supramax ships against 6 ballasting ships in Week 2, resulting in a spread of 6 vessels. This indicates that while the market is relatively balanced, there is potential for an increase in supply, which could further impact freight rates.
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Source: S&P Global
