Asian Panamax Rates Move Down Slightly

Asian Panamax freight rates for dry bulk cargo market edged lower this week on slowing demand and brokers said on Friday a recovery was likely to come only in mid-March with the start of the South American export season.

For the benchmark U.S. Gulf to Japan route, freight rates were quoted lower at US$21.42 per ton compared to $22.19 one week ago, while spot freight rates for the U.S. Pacific route were quoted at US$16.83 per ton, down from $17.28. Brokers said the freight market appeared to be depressed by an oversupply of ships as well as slow chartering activities since the Chinese New Year holidays in late January.

Some brokers had expected the freight market to bounce back this month after the end of the Lunar New Year holiday in parts of Asia, but they said such a rebound did not materialize.

One shipping agent based in Taipei attributed the weakness of the Panamax-class cargo market in part to grain importers staying on the sidelines, awaiting South American exports.

"Many grain buyers seem to have covered their near-term demand. A recovery for Panamaxes is unlikely to appear until the South American export season gets underway in March," said the shipping agent.

On the timecharter front, brokers said the market showed no signs of a pick-up with rates for the U.S. Gulf to Japan quoted lower at $10,300-10,500 a day against $10,500-$11,000 a week ago, while the Pacific route edged down to $12,000 from $12,500-$13,000.