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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

VLCC

Rates in the Middle East Gulf softened around 2.5 points to WS 97/97.5 for 270,000mt to China, with a run to Japan fixed at WS 96. Going west, 280,000mt to the US Gulf remains steady at WS 43/43.5, basis Cape/Cape.

West Africa to China basis 260,000mt came under downward pressure, with last done here five points lower at WS 92.5.

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The US Gulf to Singapore/China went at $8.4/9.4 million, while Taiwan discharge was fixed at $9.0 million.

Suezmax

West Africa again saw increased tonnage availability. Consequently, rates eased around 10 points to WS 115 for 130,000mt to UK-Cont.

The Black Sea/Mediterranean rates have been hovering in the low/mid WS 160s for 135,000mt, with South Korea at $4.6 million.

Aframax

Rates for 80,000mt from Ceyhan sit at around WS 190.

Black Sea was fixed at WS 202.5, however, the vessel was open in the Black Sea, which, saves the costs of the Turkish straits and its delays northbound.

Tight tonnage availability in the Baltic saw rates for 100,000mt gain over 35 points to WS 145. 80,000mt cross North Sea rates firmed almost 45 points to around WS 177, with Exxon paying WS 197.5, but for loading at Liverpool Bay.

In the Caribbean, rates fell early in the week to below WS 115, before recovering to around WS135.

This level was fixed by Valero on 70,000mt for mid-December Caribbs/US Gulf.

Clean

It was another encouraging week for Owners, who saw rates for 75,000mt Middle East Gulf/Japan climb about 30 points to WS 187.5. 55,000mt paying low WS 180s, up almost 35 points from last week.

Another busy week on MR's from the Continent saw the market gain 12.5 points to WS 200 for 37,000mt Continent/USAC.

The 38,000mt backhaul trade from the US Gulf enjoyed another positive week, gaining 30 points to WS 205 region.


DRY REPORT

Capesize

Last week was less eventful than the previous week. After a negative start on Monday the market witnessed a steady rise, with the Pacific far more active than the Atlantic.

Rates rose from mid $7.00s from West Australia to China to finish the week with rumours of multiple ships concluded at $9.00.

Timecharter rates on the same route were around $15,000, while round vogages went at over $20,000, returning to the highs seen the previous week.

Weather delays in the CJK area probably helped.

Atlantic volume remained thin all week, and with problems in Saldanha Bay, Tubarao/China seemed quiet with rates below $15.00.

Despite sparse trade, and a wide bid/offer spread all week, there was talk of $16.15 bid from 24 December at the end of the week.

There was also a rumoured fixture for Bolivar to Karabiga at $10 level, which equated to around $9.00 on C7.

A stronger fronthaul fixture involving an INL breach was rumoured, as Rio Tinto fixed NYK tonnage for St Lawrence to Japan in the region of $22.50 level.

Panamax

The Atlantic remained fairly quiet all week. South American rates have held at around the low $15,000s plus low $500,000s on modern Kamsarmaxes.

Sources suggested this is mainly due to a large clear out for December dates. That said, some ballasters were also competing on North Coast South American stems as well as Kamsarmax cargoes.

Further north, rates appeared fairly flat in limited trading volume, although the tonnage profile appears to be lengthening now.

The Pacific began to look like a two-tier market, with constant Indonesian stems supporting the South, whilst the North was under pressure due to a lack of NoPac and East Australian enquiry.

This was despite some weather delays for vessels in parts of China.

Owners began turning their attentions to Indian cargoes in order to obtain cover into 2019 rather than remain in the Pacific.

More period interest was evident, with several ships covered for a short period this week.

Supramax

The Baltic Exchange Supramax Index (BSI) remained in positive territory this week. This was mainly due to better activity levels from the Asian market.

Period cover continued, with a 55,600dwt open Spain fixing at $12,500 for three to five months trading redelivery in the Atlantic at $12,500.

It was a mixed bag in the Atlantic basins. The East Mediterranean was slow, with a gradual build-up of tonnage.

The market was flat from East Coast South America, whilst rates varied from the US Gulf depending on position.

An Ultramax open US East Coast was covered in the mid $23,000s for a US Gulf trip to the Mediterranean, whilst a prompt vessel in the US Gulf fixed at around $22,000.

There was better activity than of late from Asia, with a 61,000dwt open North China fixed for a round via Indonesia at $10,000.

Limited action was heard for Pacific rounds.

Some said the Indian Ocean was trading sideways, however, rates remained stable. A 57,200dwt fixed at $12,500 plus $200,000 ballast bonus delivery South Africa redelivery Arabian Gulf/West Coast India range.

Handysize

It was a relatively inactive week in both basins, with the rates relatively stable.

The Pacific market continued to weaken, whilst the US Gulf and East Coast South America markets showed some promise, with rates slightly improving.

A 34,000dwt open Brunswick next week was fixed for a trip to UK/Continent with woodpellets at $15,000.

A 33,000dwt open El Ferrol mid-December was booked for a trip to Algeria at $12,500 basis Rouen delivery.

A 34,000dwt open Casablanca was fixed for a trip to the Black Sea at $9,850.

A similiarly-sized vessel was booked from the Black Sea to Spain at $13,750.

In the East, a 39,000dwt open Surabaya was fixed via Australia, redelivery in South Korea at $11,500.

A metcoke cargo from North China paid around $8,000 on a 36,000dwt delivery mid China.

A 38,000dwt open Fujairah was taken for an inter-PG run with steels at a rate in the high $10,000s.


FREIGHTOS BALTIC CONTAINER REPORT

Transpacific ocean freight peak season has been a bonanza, with prices still more than double last year.

However, doubtful the demand would stay up, carriers cancelled the 1 December General Rate Increase (GRI).

This week, West Coast prices are down $254, while East Coast prices are down $177.

Many importers from China front-loaded in advance of the 1 January scheduled increase to the 10% trade tariff.

That boosted transpacific peak pricing, but there is a limit as to how much front-loading you can, or should, do.

With the majority of pre-Christmas demand now largely over, prices have faltered recently.

Now that the tariff increase has been given a 90-day reprieve, transpacific prices should continue trending downwards, in all likelihood up until Chinese New Year.

Although transpacific prices dropped this week (West Coast from $2,452 to $2,198, East Coast from $3,778 to $3,601), they are still more than twice the price of this time last year.

This week marks the 18th week in a row that China-East Coast prices have been above the $3,000 mark.

For China-West Coast, it's the 17th week prices have been higher than $2,000, although this run will likely end next week.

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.