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Baltic Exchange Shipping Insights

A roundup of last week's tanker and dry bulk market

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TANKER REPORT

Clean

The LR2 market for 75,000 tonnes from Middle East Gulf to Japan lost 5/7.5 WS points and is now back in the very high WS 90s.

LR1s followed suit and eased from pre-Easter levels of WS 117.5/120 to sit now at closer to WS 112.5 region.

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Another short week saw rates in the 37,000 tonnes Cont/USAC trade slip to WS 107.5 region, and there was talk of even WS 105 having been concluded here.

In the 38,000 tonnes backhaul trade, the market eased around 15 points to low WS 80s.

VLCC

After two short weeks, rates have come under pressure with the market for 270,000 tonnes from Middle East Gulf to China losing 1/1.5 points to WS 45/45.5 region. SK reportedly fixed to South Korea at about WS 42.

Going west, it is a similar story, as P66 covered 280,000 tonnes to US Gulf at WS 20 cape/cape. West Africa/China runs have been steady at around WS 45 for 260,000 tonnes. Occidental fixed a US Gulf/Singapore run at $3.3 million.

Suezmax

An uneventful week has seen rates settle at WS 55 for 130,000 tonnes from West Africa to UK-Continent, while the Black Sea market has been hovering around WS 77.5 for 135,000 tonnes.

In the Med, Algeria to Singapore was fixed at $2.0 million. Es Sider to Ningbo went at $2.5 million, while a Sidi Kerir/Canaport run fixed at WS 53.75, basis 135,000 tonnes.

Aframax

Plenty of both ice and non-ice class tonnage saw rates ease in the North. Baltic rates for 100,000 tonnes fell from low WS 70s to WS 67.5, although there is talk of possibly WS 65 having now been agreed on subjects.

The 80,000 tonnes cross North Sea market was steady at WS 90.

In the 80,000 tonnes cross-Med market charterers have been spoilt for choice and rates have been hovering in the mid/high WS 70s.

There was even a Black Sea/Med run fixed at WS 75, although subsequently WS 80 has been agreed here.

The 70,000 tonnes Caribbean/upcoast market has been steady in the mid WS 90s.

Panamax

Rates for 55,000 tonnes from ARA or Skikda to US Gulf remain under pressure, with the market hovering at or close to WS 100 level.


DRY REPORT

Capesize

The perfect storm for the big ships: with holidays, force majeure in two ore exporting ports and bad weather undermining the market.

A lack of significant activity from Brazil left the market one-sided, with owners/operators reluctant to ballast from the East, they instead chased the shorter rounds.

Rates tumbled on the West Australia/China run, coming very close to dipping below $5.00.

However, with voyage and timecharter rates so low, some owners stood back, with an uptick in paper values prompting resistance as the week closed out.

There was talk of a C5 West Australia/China run for 25 April onwards booked at $5.30.

Timecharter rates were still paying a premium to voyage, but dropped to four figures, with talk of under $8,000 daily close to fixing for an Australian round.

Ships heading for Brazil saw rates fall sharply, with the Tubarao/China rate barely in the mid $12.00s.

A potential 90-day closure at Acu, Brazil, saw several ships freed up and competing for prompt cargoes.

North Atlantic trading was extremely slow, and as the week closed out, a well-described 180,000-tonner fixed from Sines for a trip via Ponta Da Madeira to Turkey, at $7,500 daily basis, redelivery Cape Passero.

Front haul trading was slow, but Oldendorff secured a 12-year old 180,000-tonner spot Falmouth, for a run East with various loading options, at $17,500 daily.

Period rates have eased, but charterers continued to have an appetite for tonnage, albeit at lower levels.

Panamax

The week was disrupted due to the various holidays. Falling paper values meant period fixing dried up, but brokers suggested that charterers were still keen to take forward cover, although at discounted levels.

The spot market in the Atlantic saw a significant correction this week, with early tonnage forced to chase the bids down to find cover, after a buildup of tonnage on the Continent.

East coast South America remained busy, but again rates eased with modern Kamsarmaxes fixing at around $15,500 plus $550,000 ballast bonus compared to around $16,500 plus $650,000 ballast bonus the previous week.

The Pacific was hit even harder, with a lack of mineral cargoes blamed for falling rates, and the prevailing uncertainty deterring some owners from ballasting.

A week ago, a modern Kamsarmax fixed, and failed, at $14,000 for a NoPac round voyage, and then re-fixed a few days later at $12,000 for the same route with rates taking further hits.

Although a quiet end to the week, there was a consensus that the market was bottoming out, and an injection of fresh enquiry could see fortunes reversed.

Supramax

Due to the combination of holidays, both at the beginning and end of the week, together with some concern over possible trade wars, the market saw softer tendencies.

Details of older period fixtures emerged, with a 57,000-dwt fixed basis delivery Zhoushan, for about five to seven months worldwide, trading at $12,500.

In the Atlantic, rates agreed were lower, but from East coast South America a 60,000-dwt was rumoured fixed basis delivery Recalada for a trip to China, in the upper $15,000s plus $575,000 ballast bonus.

A 55,000-dwt was linked to a trip delivery where, when ready River Plate redelivery East Mediterranean, at around $18,000. Activity from the Mediterranean included a 53,000-dwt booked, delivery Constanza for a trip redelivery West Africa, at $11,550.

Downward pressure remained in the US Gulf, with brokers reporting a buildup of tonnage.

A 53,000-dwt was fixed in the high $13,000s, basis delivery Santa Marta trip to the UK, in the high $13,000s.

Asia did see similar activity levels to last week, but as the week progressed holiday fever took over. Nickel ore movements remained, with a 61,400-dwt fixed delivery CJK via Indonesia to China at around $13,000 to $14,000ss.

A 56,000-dwt was reported fixed delivery Prai via Indonesia redelivery South East Asia, at $12,250.

On the backhaul runs, an Ultra was rumoured fixed at $5,750 for the first 65 days, and thereafter, mid $13,000s, for a trip to the US Gulf.

Little activity was reported from the Indian Ocean this week.

Handy

A shorter working week in both the Atlantic and Pacific, as holidays in China from Thursday onwards slowed activity, especially in the Pacific.

Rates from the US Gulf started to ease, while some larger-sized handy vessels were reportedly competing with Supramax stems in East coast South America.

On the period front, a 45,000-dwt open Vietnam was booked for five to seven months at $11,500 daily redelivery worldwide.

In the Atlantic, a 35,000-dwt was fixed to ARA-Ghent range at $10,400 daily, basis delivery in the Black Sea. A 28,000-dwt was booked with the same delivery for moving sulphur to Morocco at $10,000 daily.

From East coast South America, brokers awaited the next fixture for a new benchmark to be set.

In the East, a 37,000-dwt was reported to have fixed to move grain via NoPac, at $10,500 daily basis, delivery CJK.


This report is produced by the Baltic Exchange.

The Baltic Exchange, a wholly-owned subsidiary of Singapore Exchange, is the world's only independent source of maritime market information for the trading and settlement of physical and derivative contracts.

Its international community of over 650 members encompasses the majority of world shipping interests and commits to a code of business conduct overseen by the Baltic.

For daily freight market reports and assessments, please visit www.balticexchange.com.

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