Miners lock in shipping costs as freight rates revive

[LONDON] Global miners and commodity traders are using multiple strategies to lock in favourable rates for shipping costs, anticipating a freight market recovery after years of turmoil.

Shipowners ordered large numbers of vessels between 2007 and 2009, just as the global economy sank into crisis. Prospects have brightened in recent months, with a pickup in global trade helping to absorb the ship glut.

Iron ore deliveries to top consumer China are up 21 per cent in the first four months of 2014 against the same period last year and are expected to rise further as major suppliers boost output and Chinese mills switch from lower quality local ore to higher grade and less polluting imports.