Chinese Iron Ore Imports Help Strengthen FFAs
Drewry Maritime Research’s latest Dry Bulk Insight saw the Drewry Hire Index improve to 229 points in June, a 6% increase from May. The largest improvement was seen in the Capesize vessel segment, resulting in the Drewry Capesize Demand Index increasing by over 80% during the month. This provides a more positive outlook for the dry bulk market thanks to increased chartering activity, low ordering, restricted deliveries and steady demolitions. A burst of Chinese ore importing was the catalyst for a big spike in the dry market in June. Period activity, an important indicator of sentiment, picked up in terms of activity and duration. Turnover soared in the dry ‘swaps’ market (FFAs): at the end of June…
Chinese Coal Imports Remain in the Foreground
There was marginal improvement in the dry bulk market as improvement in demand for larger vessel segments was countered by a decline in demand for the smaller ones. According to the latest Dry Bulk Insight, the Drewry Hire Index remained at 217 points. The Chinese coal market remained in the news, with the policy of China’s National Energy Administration still unclear as regards a potential ban on low-quality coal imports. There have been several protests from big power companies against the proposal, following which the minimum limit on imports could be reduced from 4,500 Kcal/kg to 3,750 Kcal/kg. This ban will have a direct impact on Indonesia, which supplies almost 50-70 million tonnes of lower-calorific-value coal to China.
Increased Demand for Panamax Vessels, Drewry Reports
A decline in demand for Capesize vessels has been countered by an improvement in demand for Panamax vessels, according to the latest Dry Bulk Insight published by Drewry Maritime Research. This left the Drewry Hire Index unchanged from January’s level. Panamax was the sole segment to record an improvement in earnings in February. Rates for vessels doing round voyages from Far East to East Australia more than doubled, rising from $3,954pd to $6,818. Weather-led disruptions in transport have affected Australian coal exports and will continue to do so as the mines are still flooded. There was a 19% decline in coal exports from the four major ports of Queensland in January.
Drewry's Dry Bulk Insight
Capesize difficulties countered by smaller vessel gains. Drewry Maritime Research’s latest Dry Bulk Insight report published in Januray highlights the changing fortunes of the market. December saw a large drop in the Drewry Hire Index. The dip occurred mainly due to a massive decline in Capesize segment freight rates. A lack of cargo and an oversupply of vessels led to the Capesize index almost halving in December. This depleted Capesize index was incorporated into the Drewry Hire Index causing the drop, which was tempered by a rise in handymax and handysize rates. Grain trade supported the smaller vessel segments with rates remaining firm in the East Coast of South America. Handysize rates for transatlantic round voyages increased from $4,868pd to $4,900pd, marginally up.
