THE BALTIC Dry Index rounded out last week on a high, hitting 1560, the highest it has been since late October.
Capesize
The Capesize sector saw a surge, especially in the Atlantic since midweek. More cargo from West Africa came to the market and subsequently pushed the Brazil to Qingdao run to a higher level. However, fixtures were lacking as very limited prompt ballasters could make the loading dates. In the North Atlantic, the transatlantic and fronthaul runs moved sharply higher amid a lack of tonnage in the region. Laycan window and the premium from breaching International Navigating Limits were taken into consideration. Meanwhile, sentiment suggested a year-end push. In the Pacific, the West Australia to Qingdao trade remained fairly active, the route being marked at US$8.63 on Friday. Overall the average of the 5 Timecharter routes was priced at US$18,312 by the end of proceedings, a week-on-week increase in excess of US$4,000.
Panamax
A continuation of the previous week, with a slow but steady rise in rates in the Atlantic. The North Atlantic again witnessed a tightening of tonnage supply, with fronthaul trades ex US Gulf prevalent. Coupled with a better volume of transatlantic mineral demand, the positive sentiment endured. US$20,000 was agreed on an 82,000-dwt delivery Continent for a trip via NCSA redelivery Rotterdam, whilst an 81,000-dwt delivery Rotterdam achieved low US$24,000s for a trip via US Gulf redelivery Far East. Asia struggled to get going this week with pressure mounting from the very start as the tonnage count grew. This was pitched against a lacklustre demand book and rates drifted consequently. Despite the gloom in Asia, there was plenty of period discussion and support from the FFA market, with reports of deals concluded proving to be a viable option for some owners. An 82,000-dwt delivery South China agreed US$16,000 for about 11/14 months.
Ultramax/Supramax
A rather patchy week for the sector with some key areas seeing upward momentum and others lacking fresh impetus. In Asia, sentiment was negative throughout the week with little fresh enquiry from both north and south. Tonnage availability grew with owners reducing expectations prior to the upcoming holidays. The Atlantic saw demand increase from the US Gulf sector as tonnage availability become limited for December cancelling. Positive sentiment was seen from the South Atlantic – mainly for fronthaul business. Limited period activity was seen, although a 63,000-dwt open North China was fixed for 10 to 12 months trading at US$13,850. From the Atlantic, a 63,000-dwt was fixed delivery US Gulf trip redelivery China at US$37,000. Elsewhere, a 56,000-dwt open Oran was fixed for a trip to West Africa at US$15,000. In Asia, a 58,000-dwt open North China was fixed for a round voyage via Indonesia at US$8,000. Whilst for backhaul cargoes a 63,000-dwt open North China was heard fixed for a trip to West Africa in the low US$7,000s.
Handysize
An inauspicious week punctuated with small flurries of activity in certain regions. East Coast South America came under pressure, especially in North Brazil as more tonnage ballasted from the Western Mediterranean and Continent. A 30,000-dwt was fixed Amazon River to West Coast Mexico at US$22,000, whilst a 32,000-dwt was fixed from Itajai via Bahia Blanca to South Brazil at US$17,250. The Continent saw a continued lack of requirements, with a 34,000-dwt fixed from Rouen to Morocco with an intended cargo of grains at US$8,750. In North China -Japan there has been a small increase in steel requirements and a 38,000-dwt fixed from Qingdao via South Korea to the US East Coast at US$12,000. A 36,000-dwt fixed from North China via Japan to South East Asia with a cargo of steels at US$8,050.
Clean
In the Middle East Gulf this week we’ve seen the LRs getting some strength back. TC1 has hopped up 18.13 points to settle at WS311.88 and on a run West (TC20) – after dropping into the high US$5,000,000s midweek – has returned back up and over the US$6,000,000 mark. Similarly on the LR1s a 55,000 AG/Japan came up to WS372.86 (+24.29) off the back of significantly reduced vessel availability, with a trip to the West on TC8 climbing around US$250,000 to US$5,480,000.
MRs in the region have been stable all week and the TC17 index has floated around WS475.
In Europe, LR activity looks to have been less potent and the TC15 index came off £191,667 to US$5,033,333. After a widely reported fixture at WS320, TC16 has climbed quickly to this level where it has then stayed.
On the UK-Continent MRs have suffered from a distinct lack in open activity this week. Subsequently, TC2 has come down 23.33 points to settle at WS380.28 and likewise TC19 has shed 25 points to WS398.57.
Over in the Americas the MRs have had a rough week. Freight has been slashed with an average drop of 22% across the three Baltic routes. TC14 is currently marked at WS237.5 (-52.5). TC18 lost WS93.33 to settle at WS332.5 and TC21 had a US$375,000 chunk taken out of it to just over the US$1,000,000 level.
The MR Atlantic Triangulation Basket TCE lost US$12,316 from US$68,755 to US$56,439.
Handymax in Europe have resurged this week. In the Baltic, TC9 continued its charge adding 235 points to be pegged at WS882.14 by the end of the week. TC23 – after a stable period last week – finally skipped up to WS400. TC6 has seen firm sentiment with vessels suffering from weather delays. The index has jumped up to just under WS460 (+42.82) at time of writing.
VLCC
The VLCC market bottomed out at the end of last week and rates have been firming. 270,000 mt Middle East Gulf to China is now 1.5 points higher than a week ago at WS82.88, which translates into a round-voyage TCE of US$50,700 basis the Baltic ship description. The 280,000mt Middle East Gulf to US Gulf (via the cape/cape routing) trip is assessed up one point at WS56.28.
In the Atlantic region, the rate for 260,000mt West Africa/China rose two points to WS81.45 (a round-trip TCE of about US$50,500 per day) and 270,000mt US Gulf/China fell by US$56,250 to a touch above the US$9.53 million level (US$44,350 per day round-trip TCE, about US$400 per day less than a week ago).
Suezmax
The Suezmax market slipped in all markets this week. Rates for 135,000mt CPC/Augusta fell 6.5 points to WS293.44 (a round-trip TCE of US$153,600 per day) while the 130,000mt Nigeria/Rotterdam voyage shed another 10 points to WS170 (a daily round-trip TCE of about US$63,900). The 140,000mt Basra/Lavera market eased a further four points to WS89.
Aframax
Lost ground this week with the 80,000mt Hound Point/Wilhelmshaven route down three points to WS321.88 (a round-trip daily TCE of US$146,800). In the Mediterranean, the 80,000mt Ceyhan/Lavera market is now 14 points lower at WS371.69 (a daily round trip TCE of US$135,300). The Stateside Aframax market touched bottom and a gentle rise has been seen of late. Rates for the 70,000mt East Coast Mexico/US Gulf route rose eight points week-on-week to WS248.13 (US$56,500 per day round-trip TCE). Rates for the 70,000mt Covenas/US Gulf trip are seen as flat at between WS233-234 (a daily round-trip TCE of US$48,700). For the longer-haul 70,000mt US Gulf/Rotterdam voyage, rates fell 20 points in the first half of the week and have now recovered five points to end up at WS267.5 at close of play on Thursday 15 December (showing a round trip TCE of US$60,000 per day).
LNG
We couldn’t have expected that by Christmas time, when the weather is as cold as it currently is, we would have an oversupply of tonnage and a drop in rates. Period has been the mainstay for LNG with most of the activity covered with term business. We have seen highs of over US$500 k PD round trip in Q4, and although those levels have fallen away, the outlook is positive. Rates will rebound and a bullish take on 2023 is positive for LNG on all routes. This week all three routes have again fallen short of a Christmas miracle. Subdued fixing and tonnage supply has kept rates soft and all three routes have seen falls between US$12,000-US$16,500 over the week. Term fixtures are ongoing and parties are still in discussions for several bits of business for 2023. Current estimations for a 174k 2-Stroke vsl with 0.085% boil off: US$206,250 for 12 months, and US$177,000 for three years.
LPG
BLPG1 has been flat this last week, with rates shifting only US$1.571 down to close at US$138.286 for a run Ras Tanura-Chiba. December has all been fixed away and focus has shifted into the New Year. Reluctance to fix too far out suggests that there could be softer sentiment from charterers. And while owners may complain of sluggish sentiment, ultimately – with a TCE round trip earning of US$128,232 per day – they are shedding crocodile tears.
BLPG2 has shown barely any life with minimal shifts over the week closing at US$128.2 a drop of 60 cents over the week. Slightly more life was shown on BLPG3, where a drop below US$200 is bringing back some bearish sentiment. The first half of January has been fixed away and charterers are beginning to look ahead. But with a tighter tonnage list and weather issues coming into play, it could be that we see little change over the next few weeks as charterers look for firm itineraries and safer bets to fix away.
