Panamax Rates Lose Muscle in Atlantic

The strength of panamax freight rates in the Atlantic has begun to wane, brokers said on Monday, citing a seven-point drop to 1,498 in the Baltic Panamax Index as the majority of both Atlantic and Pacific panamax routes saw returns shaved.

Analysts at Clarkson Research Studies said it had become difficult to forecast further increases in Atlantic panamax freight rates because of the large spread between the Atlantic and Pacific markets.

The softer undertone in the Atlantic was compounded by panamaxes ballasting from the Pacific to take advantage of the South American grain export market, brokers said.

Even though Pacific panamax freight rates were still falling at a faster rate than those in the Atlantic, they said, there seemed to be a window of opportunity opening from the mineral sector for shipowners with panamaxes trading the Pacific.

Despite panamax gains in the Atlantic last week, average earning levels for panamaxes dropped overall by 6.8 percent to 9,878 daily, according to Clarkson Research figures.

While the Far East and others enjoyed holidays, the charter of the 1993-built, 71,665 dwt Transgiant by Bunge provided some interest for the panamax market.

The ship has been booked for a Taiwan mid-May delivery to be followed by an 11- to 13-month timecharter for approximately $10,000 daily. The lower rate reflects general opinion that the scheduled influx of new panamaxes this year will have a much more pronounced effect on rates during the second half of 2001 than at present, brokers said.