THE BALTIC Dry Index fell to 1966 on Friday 5 July, a figure 95% higher than it was in the same week last year.
Capesize
This week began on a positive note, with the BCI 5TC increasing significantly by US$2,881 to reach US$31,438. Early in the week, the Pacific market saw significant activity, with increased participation from all of the miners and rising rates. However, the latter part of the week experienced a downturn due to increased tonnage availability and reduced coal demand, leading to a significant drop in the C5 index to US$10.28 on Friday.
The Atlantic market, previously buoyant with strong bids for end July loaders from south Brazil and west Africa to the Far East, saw limited activity as index dates shifted into August, resulting in a rate adjustments and weaker fixtures. Overall, the week started strong but ended on a softer note, reflected in the decline of the BCI 5TC, which lost US$3,746 over the course of the week to close at US$27,692.
Panamax
It has been another week that saw further significant losses. A similar pattern emerged in both basins, owing predominantly to a lack of mineral demand in the Atlantic basin and little fresh cargo emerging from Indonesia and NoPac in Asia.
Transatlantic rates fell sharply to circa US$11,000 BPI type whilst reports had a 79,000-dwt delivery Gibraltar achieving US$10,750 for a trip via NC South America redelivery Skaw-Gibraltar. Despite decent volume ex Australia, Asia lacked any meaningful cargo both in the south and the north. Consequently, rates came under pressure from said origins, with an 82,000-dwt delivery Korea agreeing US$12,000 for a NoPac round trip, whilst smaller/older types absorbed the minimal demand ex Indonesia US$13,000 the mean average on the week for route P5, highlighting the lack of support. There was limited period activity, although an 84,000-dwt delivery Singapore-Japan accomplished 117% of the BPI timecharter average for one-year period.
Ultramax/Supramax
A rather dull week for the sector as rates and demand fell away in most areas. The only bright point seemed to be the US Gulf, which, despite the holiday, saw better demand and the Ultramax size seeing in the mid-upper US$20,000s for trips to Asia.
Elsewhere, limited fresh enquiry saw vessels struggle from the Continent-Mediterranean, although a 56,000-dwt fixed a trip delivery central Mediterranean via the Black Sea to the Far East in the low US$20,000s. From Asia, limited cargo from the south saw rates drop. A 56,000-dwt open Vietnam fixing an Indonesian round at US$14,000. Further north, a 63,000-dwt open China fixed a trip to the US Gulf in the US$12,000s.
The Indian Ocean similarly lacked fresh impetus, with a 56,000-dwt fixing delivery Maputo trip WC India at US$16,500 plus US$165,000 ballast bonus. There was little appetite for period cover and it remains to be seen how the summertime feel might change.
Handysize
A week of minimal visible activity across both basins in the handy sector. In the Atlantic, a general lack of cargo availability set the tone. Whilst Independence Day celebrations in the US slowed activity towards the end of the week, a 36,000-dwt fixed from the Mississippi River to Chiile at US$17,000, whilst a 38,000-dwt fixed from Atlantic Columbia to the Continent with coal in the US$15,000s. A 35,000-dwt was rumoured to have fixed from SW Pass to Morocco in the US$12,000s.
Limited prompt enquiry in the South Atlantic led to a downward trend with a 36,000-dwt fixing from Fazendinah to Morocco with grains at US$14,500, whilst a 43,000-dwt fixed from Recalada to Puerto Quetzal with grains at US$23,500 both earlier in the week and, whilst numbers had continued to soften, many had hope positivity would return in the coming weeks with cargo availability rumoured to improve. In Asia, visible activity was also muted but sources spoke of a balanced market in general.
Clean
LR2
MEG LR2’s saw just enough demand to keep rates stable this week. The TC1 rate for 75Kt MEG/Japan floated around the WS180-WS190 level all week and the 90kt MEG/UK-Continent TC20 voyage held in the US$5.8-US$5.9m region.
West of Suez, Mediterranean/East LR2’s improved off the back of some activity this week. The TC15 index hopped up US$200,000 to US$3.9m.
LR1
In the MEG, LR1’s looked to soften this week with available tonnage abundant. The 55kt MEG/Japan index of TC5 dipped from WS231.88 to WS227.19 and the 65kt MEG/UK-Continent of TC8 remained flat at US$4.8m.
On the UK-Continent, a 60Kt ARA/West Africa run on TC16 came down to WS138.61 (-2.78) off the back of very little activity this week.
MR
MR’s in the MEG came under significant pressure this week. The TC17 35Kt MEG/East Africa index lost 55.72 points to WS248.57.
On the UK-Continent MR’s held onto current freight levels. The 37kt ARA/US-Atlantic coast of TC2 settled at the end of the week at WS182.19, which is a Baltic round trip TCE of US$19,675/day. The TC19 run (37kt ARA/West Africa) mirrored TC2 all week and is currently pegged at WS202.19.
As USG MR’s dropped off significantly this week prior to the national holiday. TC14 (38kt US-Gulf/UK-Continent) dropped to WS192.14 (-37.86). The 38kt US Gulf/Brazil on TC18 went from WS329.29 to WS282.14 and the 38kt US-Gulf/Caribbean of TC21 came down 36% to US$1.04m now returning US$40,647 /day on Baltic description round trip TCE.
The MR Atlantic Triangulation Basket TCE dropped US$8012 to US$36,391.
Handymax
In the Mediterranean, 30kt Cross Mediterranean (TC6) remained flat at the WS185-190 level. In northwest Europe, the TC23 30kt Cross UK-Continent came back down 10.84 points this week to WS165.83.
VLCC
The VLCC market eased ever so slightly this week. The rate for the benchmark 270,000 mt Middle East Gulf to China slipped a point from last Friday to WS48.45, which provides a daily round-trip TCE of US$24,266 basis the Baltic Exchange’s vessel description.
In the Atlantic, market weakness was matched. The 260,000mt West Africa to China was down a point for the week at WS54.17, showing a round voyage TCE of US$30,976/day, and the rate for 270,000mt US Gulf to China fell by US$108,500 to US$7,630,000 corresponding to a round-trip daily TCE of US$34,072.
Suezmax
The Suezmax market in West Africa took a tumble this week, with little activity being reported. An oil major was reported to have had a cargo early in the week, for which at least 10 ships were offering so the sentiment dropped off. The rate for 130,000mt Nigeria to UK Continent route fell almost 10 points by Thursday to WS100 (a daily round-trip TCE of US$36,509) while the 135,000mt CPC/Mediterranean route remained flat hovering around the WS120 mark (showing a daily TCE of a little above US$47,000 round-trip). In the Middle East, the rate for 140,000mt Middle East Gulf to the Mediterranean (via the Suez Canal) continues to be assessed around the WS93.5 level.
Aframax
In the North Sea, the rate for the 80,000mt Cross-UK Continent plummeted 14 points to WS131.67 (a daily round-trip TCE of US$32,041 basis Hound Point to Wilhelmshaven).
In the Mediterranean market the rate for 80,000mt Cross-Mediterranean slipped one point to WS152.61 (basis Ceyhan to Lavera that shows a daily round trip TCE of US$39,764).
Across the Atlantic, the US Independence holiday on Thursday meant a short week. For the 70,000mt East Coast Mexico/US Gulf (TD26) the rate slipped 2.5 points to WS171.56 on Wednesday (a daily TCE of US$39,634 round trip) and the rate for 70,000mt Covenas/US Gulf (TD9) was a little over three points softer at WS168.75 (a round-trip TCE of US$32,041/day). The rate for the trans-Atlantic route of 70,000mt US Gulf/UK Continent (TD25) eased almost 2 points to WS171.39 (a round trip TCE basis Houston/Rotterdam of US$38,404 per day).
LNG
Plenty of fixing activity on the LNG spot market, albeit focused primarily on the Atlantic side, has not done much to push rates up. Reports of some period and spot fixing early on in the week led to around 4-5 fixtures that has cemented the levels we are seeing. For summer months, modern 2-stroke tonnage commanding nearly US$100,000/day shows signs of a healthy and active fixing market but with the main holiday season approaching it will be a hard push to get ships fixing too much higher.
BLNG1 Aus-Japan was quite flat as the Pacific languishes behind the Atlantic, 160cbm ships lost US$128 to a close of US$39,526 while the 2-stroke 174cbm ships gained US$1,121 to finish at US$52,021. Out in the Atlantic BLNG2 Houston-Cont gained for both ships and the 160cbm finished up at US$69,600 while the 2-strokes maintained a US$20,000 delta finishing at US$89,100. Houston-Japan BLNG3 inched higher with 2-stroke 174cbm at US$97,500 while the 160cbm TFDE ships closed at US$78,448.
With two ships taken by Gail from Shell, period was not lacking in activity but rates are softer while owners take stock of potential winter spikes, for six-months we published US$102,900, one-year terms at US$82,833 and the three-year periods finished at US$84,000.
LPG
There were only a few reported fixtures this past week from the Middle East, and rates took a slight downturn as a result. For the month of July, there has been a spate of fixing already and it could, in terms of physical fixtures, outperform other summer periods from years previous. But it is early in the month still and there are no absolutes in LPG. The BLPG1 Ras Tanura-Chiba index fell by US$4.071 to a close of US$63.143 and a daily TCE earning equivalent of US$42,147.
The Atlantic market has improved in terms of activity, but rates still suffered, if only slightly. BLPG2 Houston-Flushing lost US$1.8 to close a US$61 and a daily TCE earning of US$58,262. While BLPG3 Houston-Chiba fell by US$2.143 to US$108.571 and a daily TCE earning equivalent of US$39,977.
