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Baltic Exchange Shipping Insights
The Golden Week holiday prompted an uptick in enquiry with rates firming four points to WS 59/59.5 for 270,000mt from the Middle East Gulf to both China and Singapore and 280,000mt to the US Gulf now assessed around WS 23 Cape/Cape.
West Africa to China moved in line with the Middle East Gulf, with last done at WS 60, basis 260,000mt. The US Gulf to Korea went at $5.2 million, with Hound Point to South Korea fixed at $4.65 million.
West Africa gained five points to WS 77.5 for 130,000mt to UK-Continent, with the potential for further increases. Delays in the Turkish Straits saw the Black Sea add 10 points at WS 100 for 135,000mt to Mediterranean, with South Korea covered at a firmer $3.55 million.
An active week in the Mediterranean, with WS 107.5 paid from Ceyhan and the Black Sea, basis 80,000mt, with further rises expected.
Baltic rates gained 10 points, peaking at WS 90 for 100,000mt, while the 80,000mt cross North Sea market rose to WS 117.5.
The Aframax market in the Caribbean eased 7.5 points to the low WS 140s for 70,000mt from Venezuela to the US Gulf.
The ARA to the US Gulf market dropped 7.5 points to WS 112.5 for 55,000mt.
In the 75,000mt Middle East Gulf to Japan trade, rates firmed three points to WS 103.25 while healthy activity prompted a five-point rise to WS 120 for 55,000mt. Higher bunker prices and increased demand to West Africa saw rates in the 37,000mt Continent/USAC trade add 10 points to WS 110, while the 38,000mt backhaul eased from low WS 100s to just below WS 100.
A stop-start market for the big ships with many expectations and few fulfilled. Holidays curtailed trading early in the week, but the C5 route regained some ground with rates in excess of the mid-$7.00s for 11 October onwards, although, bunker values also rose sharply last week.
Owners remained optimistic, wanting $8.00 as the week closed out, with some suggesting it had been done.
Timecharter trading was less prevalent, with rates ranging from $15,000 to the low $17,000s for Australian round voyages, with the rate dependent on how well the ship was described. Brazil was expected to be active, but again fixing was piecemeal, with rates for mid-late October still under $21.00 for Qingdao discharge.
Further north, talk focussed on a tightening supply of tonnage, with rumours dominating the market of sharply higher rates agreed, but not always confirmed as fixed.
There were various rumours of over $20,000 daily for transatlantic rates and some suggesting the Puerto Bolivar/Rotterdam route was in excess of $10.00 and heading towards $10.50.
Despite the disruption due to the holidays in the East at the start of the week, rates have improved everywhere ahead of further holidays this week. The Pacific has been well supported by mineral trades, especially into India, with South America adding fuel to the flames as owners in the South were able to fix on a DOP basis.
A well described Kamsarmax achieved $17,000 daily basis Singapore delivery for a South American round.
The Atlantic was busy from the start of the week, with a shortage of tonnage from the Mediterranean, with Kamsarmaxes achieving $15,500 to $16,000 for longer grain rounds which were similar levels to the shorter coal trips in the North.
There was also a number of front haul stems from St Lawrence to China covered at around $23,000 daily from Continent deliveries. Period activity was sporadic as charterers considered the effect of this week's holidays.
Overall a positive week for the BSI with gains made from key areas. Period activity remained, with a 56,000dwt fixed delivery Kandla for three to five months trading at $13,500.
The Atlantic saw better demand from the US Gulf, Mediterranean and South Atlantic regions, with a 52,000dwt being covered from the US Gulf to the East at $24,000.
In the Mediterranean, a 60,000dwt was fixed delivery for a Canakkale trip via the Black Sea, redelivery Chittagong, at $24,000.
Demand remained from Brazil, with charterers seeing improved values for Ultramaxes on the back of strong rates for Panamaxes, with a 63,000dwt covered in the upper $15,000s plus upper $500,000 ballast bonus.
With holidays last week and imminent holidays this week, the market remained relatively firm.
A 56,000dwt fixed delivery for a Surabaya trip with redelivery to west coast India at $13,500.
More demand was seen from the Indian Ocean, with a 55,000dwt fixed delivery Durban for an early October trip, redelivery CJK-Japan, at $13,700 plus $370,000 ballast bonus.
Like the larger sizes, it was a more positive week for the BSHI, with gains made across many routes. Some period activity surfaced, with a 32,000dwt fixed from the Continent for three to five months, trading redelivery to the Atlantic in the mid $10,000s.
The Atlantic saw upward pressure from the US Gulf, with brokers suggesting a tightening in tonnage supply was pushing rates higher.
From East coast South America, demand remained, as a 37,600dwt fixed delivery Santos for a trip via the Plate to the Baltic in the mid to upper $15,000s.
As the week came to an end some suggested a slight easing of demand from the Mediterranean, but few fixtures were disclosed.
With the upcoming holidays in the Asian market, brokers advised little activity evident towards the end of the working week.
A 37,000-dwt was reported fixed for two laden legs delivery Indonesia, redelivery Singapore- Japan, but many were waiting to see how the market will progress in the coming days.
FREIGHTOS BALTIC CONTAINER REPORT
Since the beginning of June this year, every transpacific GRI has been implemented, a sign of strong demand (particularly when combined with carriers striking service). This helped get peak season off to an early start, augmented by threats of new trade tariffs that pushed importers to stock up in advance.
That changed this month. The September 15 GRI was cancelled, forcing ocean carriers to contemplate a possible early end to peak season.
"Despite the GRI cancellation, the White House's announcement of another round of China trade tariffs this month may help stave off an early end to peak season. However, while carriers may be reaping the benefits of impending tariffs today, the long-term impact of the tariffs will almost certainly be far more negative, casting uncertainty for carrier profitability in 2019." said Eytan Buchman, VP Marketing, Freightos.
With Golden Week beginning next week, space remains very tight for China-US shipments. Despite that, China-West Coast and China-East Coast prices haven't moved from the previous week.
Not so, with China-North Europe prices, which dropped 14% on last week with CMA CGM, and Maersk both dropping their FAK rates.
The Freightos Baltic Indices reflect weekly spot rates for 40-foot containers based on 12 to 18 million price points collected every week on 12 main shipping trade lanes. The data is audited by the Baltic Exchange and includes the headline index - the FBX Global Container Index (FBX) - a weighted average of the 12 underlying route indexes. This data is published every Sunday. See: www.balticexchange.com/market-information/containers/
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.
- The report is also available online at bt.sg/baltic.