Baltic Exchange Shipping Insights

Capesize

The Capesize market delivered a mixed yet broadly steady performance this week, with underlying demand offering support despite some midweek pressure on rates. The Pacific started strongly, driven by strong miner activity and firmer C5 fixtures that helped absorb tonnage. However, momentum faded midweek, with C5 values easing despite continued miner and operator presence, with rates slipping back towards the $10.00 level and then edged up on Friday with fixtures at $10.20. In the Atlantic, South Brazil and West Africa to China maintained consistent engagement, with fixtures broadly ranging between the low-to-mid $24 on C3 for the end of September, while fresh October demand began to surface. The North Atlantic also saw more activity as the week developed, with fronthaul and transatlantic enquiry evident, although rates were trimmed from earlier highs. Overall, the BCI 5TC opened the week at $25,140 but lost ground midweek before recovering part of the decline to close Friday at $24,257, up $339 on the day.

Panamax

It proved to be a muddling week for the Panamax market, which started out positively for owners but ends on something of a tepid nature. In the Atlantic, much of the activity early part of the week was on the fronthaul trips from the Americas with solid levels of support. The September arrival window ex EC South America was perhaps the exception with fundamentals unchanged; tonnage count tighter. Transatlantic rates via US East Coast/NC South America hovered around the $20,000 level depending on the respective ship’s specs and delivery. Asia returned a similar story, with the coal runs ex Australia supported early part, with several deals concluded around the $15,500-16,000 mark for index types. However, rates eased back as the weekend approached. The longer NoPac trips were lacking and Indonesia coal runs into China were the only trip supported. Plenty of period activity on the week, with $16,000 agreed for one year on an 82,000-dwt delivery China being the highlight on the week.

Ultramax/Supramax

With many returning to their desks after the summer vacation period, it was a more positive week overall certainly in the Atlantic. Stronger numbers were again seen from the US Gulf, as prompt tonnage availability remained tight, with some saying that offers for the ultramax size being around $30,000 for fronthaul business. From US East Coast, a 63,500-dwt vessel was heard fixed delivery Bristol trip redelivery Egypt at $30,000. The South Atlantic also saw better demand, with a 63,000-dwt fixing delivery Santos for a trip via Red Sea redelivery Port Said at $27,000. From Asia, it was a similarly stronger week, although as the weekend approached some felt that demand might have been easing a little. A 55,000-dwt reported fixing delivery China for a trip to Bangladesh at $21,500, while a 63,000-dwt fixed delivery Campha for a trip Chittagong at $23,000. The Indian Ocean remained rather calm, with a 63,000-dwt fixing delivery Mumbai trip via South Africa redelivery China at $12,000. Period activity remained, with a 61,000-dwt fixing about 6 months at $17,000 basis delivery Weda.

Handysize

It was a positive week, with rates firming across most loading regions. Although reported activity was limited, the Continent–Mediterranean continued to show gradual improvement, with sentiment largely positional. For instance, a 37,000-dwt was fixed delivery Antwerp for a trip to the US Gulf with steels at $9,750. The South Atlantic and US Gulf markets maintained their strength, supported by steady demand and firm sentiment, which lifted rates further. Notable fixtures included a 39,000-dwt fixed from Recalada to Peru with grains at $21,000 and a 37,000-dwt fixed for a trip from SW Pass to West Coast with grains at around $21,000. Likewise, the Asian market also remained active and positive, underpinned by healthy cargo flows and limited vessel availability. A 39,000-dwt was fixed for a trip delivery Huludao via North China to Oman at $13,000. Period activity also drew interest, with a 36,000-dwt open in Lagos was fixed for 3 to 5 months redelivery Atlantic at $12,500, while another 36,000-dwt open Abidjan 20 Aug fixed for 3 to 5 months with redelivery worldwide at $12,750.

Clean

LR2

LR2 freight in the MEG was steady with modest improvement this week. The TC1 75kt MEG/Japan index climbed from WS140 to WS147.5. A TC20 90kt MEG/UK-Continent trip also ticked up $12,500 of value to $3.93 million. West of Suez, Mediterranean/East LR2’s ended the week assessed $20,000 higher at $2.97 million for a TC15 Baltic description voyage.

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LR1

MEG LR1’s tracked downward this week. The TC5 55kt MEG/Japan index fell 7.81 points to WS149.69. A voyage west on TC8 65kt MEG/UK-Continent also moved down $85,735 to $2.97 million.

On the UK-Continent LR1 freight managed to creep from WS112.5 to WS115.5, with reports of available tonnage tightening for the TC16 60kt ARA/West Africa index.

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Baltic Exchange Shipping Insights

MR

MR freight in the MEG held stable this week. The TC17 35kt MEG/East Africa index went from WS220.71 to WS217.14.

UK-Continent MRs were pushed back downward this week. The TC2 37kt ARA/US-Atlantic coast went from WS121.88 to WS110.63. This saw the Baltic TCE round trip for the run drop 20% to $7,974/day.

USG MR freight continued its strong upwards movement this week. The TC14 38kt US-Gulf/UK-Continent trip jumped by another 43.22 points to WS249.29, increasing the Baltic TCE by 30% to $37,541/day round trip. A Caribbean run on TC21, 38kt US-Gulf/Caribbean also saw a significant upturn of $276,428 to $1.39 million also seeing the TCE move up from $46,472/day to $62,566/day on Baltic description round trip.

The MR Atlantic Triangulation Basket TCE went from $36,201 to $42,749.

Handymax

The Mediterranean Handymax of TC6, 30kt Cross Mediterranean remained unmoved at WS135 all week. The TC23 30kt Cross UK-Continent managed to climb a meagre 4.72 points to WS154.72.

VLCC

The VLCC markets in the Middle East and West Africa slipped slightly while the US Gulf rates continued the recent upward trajectory. The rate for the 270,000 mt Middle East Gulf to China trip (TD3C) slipped 1.5 points to WS66.5, corresponding to a daily round-trip TCE of close to $49,034.

In the Atlantic market, the rate for 260,000 mt West Africa/China (TD15) also eased 1.5 points week-on-week to WS64.81, giving a round voyage TCE of $47,382. In the US Gulf region, the rate for the TD22 route of 270,000 mt US Gulf to China improved by another $341,111 to $8,136,111, which shows a daily round trip TCE of about $43,300.

Suezmax

In the Suezmax sector, the market has peaked but remains firm. The rate for the 130,000 mt Nigeria/UK Continent voyage (TD20) eased back four points to WS107.78, which translates into a daily round-trip TCE of about $47,800. The TD27 route (Guyana to UK Continent basis 130,000 mt) slipped two points to WS106.78, meaning a daily round trip TCE of a little less than $47,000. The TD6 route of 135,000 mt CPC/Augusta is slightly weaker than a week ago, losing two points to WS142.5 giving a daily TCE of just over $72,250. In the Middle East, the TD23 route of 140,000mt Middle East Gulf to the Mediterranean (via the Suez Canal) lost about 2.5 points to the WS100 mark.

Aframax

In the North Sea, the rate for 80,000 mt Cross-UK Continent route (TD7) fell back three points to the WS140 level, giving a daily round-trip TCE of close to $51,300 basis Hound Point to Wilhelmshaven.

In the Mediterranean, the rate for 80,000 mt Cross-Mediterranean (TD19) continued the falling streak, losing 6.5 points to the WS135 mark (basis Ceyhan to Lavera that shows a daily round trip TCE of about $30,800).

Across the Atlantic, the market climbed for the Baltic routes. The 70,000mt East Coast Mexico/US Gulf route (TD26) gained 5 points to the WS158 level (giving a daily round-trip TCE of about $35,400) and the 70,000mt Covenas/US Gulf route (TD9) recovered about 7 points to the WS155 mark (translating into daily round trip TCE of just close to $33,300).

The rate for the trans-Atlantic route of 70,000mt US Gulf/UK Continent (TD25) was boosted by 13 points to WS168.61 giving a round trip TCE basis Houston/Rotterdam of $42,657/day.

On the Vancouver exports, TD28 (80,000 mt crude oil Vancouver to China) slipped $37,500 to $1,787,500 and TD29 (80,000 mt crude oil Vancouver to Pacific Area Lightering point on the USWC) was 11 points weaker at WS115.

LNG

It has been a softer week in the LNG market, with rates moving lower across both spot and period segments as limited demand met steady vessel availability. The absence of strong fresh enquiry has left sentiment under pressure, with all key routes relinquishing ground.

On the BLNG1 Australia–Japan route, 174k cbm vessels dropped $1,000 to $33,300/day, while 160k cbm tonnage slipped $1,100 to $19,600/day. Pacific activity remained muted, with little to absorb the available length in the basin.

The BLNG2 US Gulf–Continent route fell more sharply, with 174k cbm earnings down $2,100 to $34,600/day and 160k vessels off $1,600 to $20,200/day, reflecting subdued Atlantic demand and pressure from increasing prompt availability.

On the BLNG3 US Gulf–Japan route, 174k cbm ships eased $1,300 to $42,800/day, while 160k cbm units lost $1,800 to settle at $24,100/day, with longer-haul demand failing to provide meaningful support.

Period markets were also weaker. The six-month TC rate fell $1,800 to $42,350/day, the one-year rate slipped $1,825 to $43,925, and the three-year term was down $750 to $56,050, reflecting softer sentiment across the board.

LPG

It has been a quiet week in the LPG market, with sentiment softening as the arb continued to move and charterers showed limited appetite to chase rates higher. Levels drifted lower across all three routes, with tonnage availability keeping pressure on earnings.

On the BLPG1 Ras Tanura–Chiba route, rates slipped $3.33 to $83.83 per metric tonne. TCE earnings fell $4,282 to $70,846/day as Middle East activity remained steady but supply of available ships weighed on sentiment.

The BLPG2 Houston–Flushing route eased $1.00 to $81.00 per metric tonne, with TCE returns down $1,449 to $91,522/day. The BLPG3 Houston–Chiba route also softened, down $2.58 to $148.42 per metric tonne. TCE earnings slipped $2,559 to $73,771/day, as the narrowing arb reduced long-haul demand and undercut recent momentum.

Container

Rates on the key FBX routes ex Far East have all slipped lower by varying amounts. However, overall, the past week has been a quiet one, with no major relevant market events happening.

FBX01 (China/East Asia – USA West Coast) ended the week at $1,728/FEU, down $14/FEU from last Friday. FBX03 (China/East Asia – US East Coast) ended the week at $2,703/FEU down $23 compared with last Friday.

FBX11 (China/East Asia – North Europe) ended the week at $2,846/FEU down $107 from last Friday. FBX13 (China/East Asia – Mediterranean) ended the week at $2,999/FEU down $81 from last Friday.

Come mid-October USTR port call fees for Chinese linked tonnage will come into effect for US port calls. Some liner operators have, where possible, been swapping Chinese built/owned tonnage out of services that loop into the US and moving them into Med and North Continent services. However, this is only possible where vessels being used in the services are of a similar TEU capacity. Some liner operator’s tonnage is mostly Chinese linked and will be unable to avoid these charges, so these operators will likely have to adopt surcharges on their US services, so it will be interesting to see how this develops in Q4.

This report is produced by the Baltic Exchange. (All currencies are in US dollars.)

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. 

The report is also available online at bt.sg/baltic.