Drewry’s Chemical Tanker Freight Rate Index dropped during the first quarter, registering its first quarterly decline since 3Q10. Transpacific westbound rates lost as much as 13%. The next quarter is traditionally a lean period, with Drewry forecasting rates to bottom out before climbing in the latter stages of the year, but this might not be good news for everyone. Overcapacity remains the bane of the market, so owners are hoping for a surge in freight rates coupled with a fall in bunker prices, which have eroded their earnings. Otherwise, they will struggle to maintain service levels and avoid serious cash-flow problems and insolvencies. Owners are responding by reducing their fleets to cut costs.