Vale unique new coal transfer method

Saturday, 21 Jan 2012

It is reported that Brazilian mining giant Vale, through its subsidiary Vale Mozambique has started with the process of transferring coal from small boats to ships out at sea a first for the company and a solution for loading large ships at the port of Beira.

Vale Mozambican subsidiary also said that the Green Phoenix the fifth ship to export the company coal and left the port recently carrying 37,600t of coal headed for the port of New Mangalore in India.

With this shipment, Vale has so far shipped 174,000 tonnes of coal mined at the Moatize mine through the port of Beira since it launched its operations in 2011.

The statement said the transfer operation made it possible not only to completely load some ships that cannot be entirely filled at the dock, but also makes it possible to load bigger Panamax and Capesize ships, which are unable to moor at the port of Beira because the access channel and berths are too shallow .

By the end of December Vale Mozambique had mined 620,000 tonnes of coal and exported 140,000 tonnes which were transported to the port of Beira along the Sena railroad.

(sourced Miningreview.com)

Indian Iron Ore Market remains Dead - Fearnleys

Friday, 04 November 11

Handy
The Atlantic market kept its strong position from last week. Even with fewer fixtures reported. Fronthauls still around 25k, with a 2-3k usd premium for vessels willing to go through Aden. USG/Skaw fixing around usd 29700, and Skaw/USG concluded in the usd 8000 range. We do believe less activity in the weeks ahead of us. The Pacific market has been dropping and it seems like it will continue to remain so due to lack of fresh cargoes and building up of tonnages. For Indo-India, large eco Supra can fetch close to usd 10k from North China position and NOPAC RV close to usd 9k. Indian iron ore market remains dead with no activity on WCI & ECi forcing vessels to ballast to RBCT and Indonesia. RBCT rounds now fixed basis APS ++BB and vessels ballasting from ECI to Indonesia fixing around usd 8k. Red Sea fertilisers to India are fixed around mid 20s. Very little activity on short period and rate is around 12k for large Supras.

Panamax
Fair activity with mineral requirements in the North Atlantic from USEC and Baltic catering for healthy levels as market is tight for prompt loaders. Fixing levels in the 20´s for Baltic rounds, upper teens for TA rounds. Less activity and weakness in the USG and ECSA from an increasing number of ballasters appears from the Med and Far East. Levels for trip out hovering in the 26 + 600 range basis APS. In the Far East activity is low, tonnage lists grow, and rates are under downward pressure. NOPAC rounds 12500, period activity scant. The general sentiment is losing confidence from a slow and descending forward market.

Capesize
After a relatively long period with improving rates, the Cape market experiences a correction mid last week. Rates kept dropping throughout this week, with West Australia/China being done just bellow usd 10 pmt. Tubarao/Qingdao was done last week around usd 32 pmt, the lowest done this week is just below usd 25 pmt. The drop in spot rates has resulted in less period activity with chrtrs aiming around mid teens, a level perceived to be of non interest to the owners. The rest of the week is remained to be quiet with Eisbein going on in Germany.

(source - Fearnleys via coalpsot)

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Supras Ex Richards Bay Coal Terminal to India hovering at $ 25 - 27.00 PMT - FEARNBULK

Friday, 01 April 11

Handy

Atlantic markets remain stable with more activity from the Black Sea to FEast paying in the mid 20´s on Supras. The USG remains firm paying in the mid 20´s for trips into the Med and low/mid 30´s for trips FE.

Outlook: stable. The Pacific market is still weak; the signs of weakening are lack of fresh enquiries and less trading activities. Indian activities are also very slow. Supras on WC India are seeing high teens for trip to China with freight levels hovering between usd 20 pmt. Supras ex Richards bay coal terminal/ India hovering at usd 25/27.00 pmt. Ex Red Sea to India handymax tonnages are seeing mid/high 20´s.

Panamax
With few fresh cargoes entering the market, the rates declined marginally this week. TA´s fixed in average around USD 16k, which is a tick down from last week. South America and coal from US kept the market going. In the Pacific the rates hovered around USD 16500. However rumors stated that Japan would increase their coal import, due to lack of nuclear energy. The ballasters from the Pacific and Indian Ocean obtained decent numbers, around USD 16-17k daily, which was in line with the short period market.

Capesize
Activity is up but same has yet to be reflected in rate levels as this segment remains generally overtonnaged. The main WAust/China ore trade is erratic in volume but stable in value at usd 7.35-45 pmt - equivalent to less than opex. Nuclear concerns have given some support to Atlantic coal activity/ expectations, with resultant transatlantic levels maintained at some usd 12250 and fronthaul also unchanged at around usd 23350. With an inverted forward curve, period activity is limited to 180kdwt/blt 2009 spot FEast done for 12 mos at usd 16k, 177kdwt/blt 2004 China ppt done for 4-6 mos at usd 15500 and 174kdwt/blt 2007 said to be done for 2 yrs at around usd 17500. source:Fearnbulk

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The Panamax market this week firmed up - BRS

Tuesday, 08 March 2011

Underlining the unpredictability of the current market, rates for all dry bulk segments swung up again last week. Stronger exports out of South America lifted the smaller sizes, while better transatlantic demand pushed Cape rates up.

In the iron ore segment, a short-term surge in demand seems possible after India imposed new export taxes on the commodity. The Federation of Indian Mineral Industries said it expected ore exports to fall between 30-35% a year as a result. Nearly all of India’s iron ore shipments are destined for China, and it is expected there could be a rush of Chinese buying before the tax is imposed on April 1. So far, existing contracts out of India are being honoured, but with next to no fresh contracts being signed, the impact of the change is likely to be more obvious next month.

Supramax/Handy

The Supramax market continued its upward trend from the previous week, and the BSI gained 6% to reach a TC average of US$15,340 by Friday. The increase was much stronger in the Pacific basin than in the Atlantic, and the NOPAC round gained 13% to reach about US$15,500 by the end of the week. Despite better market conditions in the Pacific, owners with Supras in the Atlantic were reluctant to fix them for a trip out. The market in the Continent was strong thanks to scrap and fertilizer orders, Supras getting about US$20,000 for a trip with scrap from Cont/Baltic with redelivery east Med, and the same level was fixed for dop Continent and redelivery China via the Cape of Good Hope. The US Gulf market remained stable with Supras getting fixed at US$24,000 basis dop USG and redelivery Skaw/Passero range, whereas USG to the East was fixed in the low US$30,000s per day. The Pacific market started strong, with index type Supras getting mid teens for Pacific rounds, while India positioned ships were fixing at similar levels out of the west coast, and mid/high teens out of the east. Rates steadily picked up towards the end of the week (due to tonnage getting tight for mid March dates), while a flurry of fixing resulted in ships in the Far East getting closer to high teens for Pacific rounds. West coast India to China was fixing in the mid/ high teens, and east coast India remained at similar levels. Backhaul on Supras climbed to close to US$10,000, up from around US$7-8,000. Short period was around mid to mid/high teens, depending on specs and position, and this remained steady all week.

Panamax
The Panamax market this week firmed up in all basins, with a week-on-week increase of over US$1,000 in the Atlantic to reach US$16,000 per day, and more than US$1,500 in the Pacific, to close at US$14,800 per day, pushing the 4TC average to US$16,000 per day. These trends were against a pretty high global offering of tonnage (especially in the Atlantic), except in the Indian Ocean which was clearly under pressure due to a lack of candidates able to carry iron ore to China, or to ballast to pick up grains for China via ECSA. This route was paying around US$19,000 per day for delivery India. Period activity, linked to the firmer FFA market, increased by US$1,000 per day ie around US$18,000 per day on a TESS 74 delivery Far East for short period.

Capesize
An 8% increase in the BCI this week, with greater activity in the Atlantic pushing rates. The BCI finished on Friday at 1,427 points, while the time charter average limped above US$5,700 per day. The prospects of more activity out of Australia gave some small confidence to the market, and April and May FFA rates rose to US$14,500 and US$16,400 respectively. Monday saw another US1,000 added to the 4TC, which suggests greater confidence for the week ahead, though which the current volatility there seems to be no certainty it will last.
Reported by - Barry Rogliano Salles

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Iron ore from India has been quit

Friday, 04 March 11

Handy

Activity has been gradually rising in the Atlantic but it is mostly confined to the USG market. Short period basis redelivery Atlantic has been reportedly done at usd 24,000 pd delivery USG. The Cont/Bsea remain quiet with little activity which is forcing tonnage to ballast towards Gib. Many Owners are still reluctant to trade Suez or Aden. A 50kdwt blt 03 was reportedly fixed at around usd 20k pd dely Cont via CGH to FEast. Mkt remained firm in Pac. Supras in North China are fixed at close to 15k for trips via Indo to India with coal. Iron ore from India has been quiet with recent 20% export tax and mkt looks uncertain. Supras on WCI and ECI close to 17k for trips to China. On Richards Bay rnds supras now seeing around mid-teens. Red Sea, ferts on hmax/ supras are fixed at very high 20´s pmt on voy bss to WCIndia. Owns have been rating close to mid 30s due to increased piracy threat and bunker prices. Not much seen on short period as rates are seen rising and now around usd 17k.

Panamax
With lack of fresh grain business from USG or ECSA the sentiment is looking bit toppish leading to a slow decline in rates and interest for period. In the USG/ECSA area a majority of March cargoes seems to be fixed adding pressure to the Fronthaul rates. Mid week fixtures for same in the 25,000 + 600,000 GBB area. Atlantic business after a fairly steady week also under pressure with oversupply of spot tonnage still levels hovering around 15,000/Day. In the Pacific rounds fixed at USD 13,500 levels and some healthy fixtures for ECSA rounds still reported at high teens basis India-SE Asia delivery. Short Period fixed at 17,500, and 1 yr at 16,000 prompt delivery Far East.

Capesize
Two months into 2011 and we see the full effect of the sad reality describing the cape market. Last week bunker prices made a big jump,resulting in slightly improved rates but even more ships at anchor. West australia round is presently between USD 6.50 and 7 pmt, whilst fronthaul remaining steady around low USD 18. A lack of cargoes around and more tonnage coming suggesting the present poor market to continue for some time. (sourced:Fearnbul)

Mixed fortunes for dry bulk owners this week - Nikos Roussanoglou, Hellenic Shipping

Wednesday, 02 March 11

Although the dry bulk market has been on the positive side this week, things still look quite uncertain in the near term, with most owners puzzled as to what their next move should be in such a fluid market environment. Still, the industry’s benchmark, the Baltic Dry Index (BDI) managed to edge higher yesterday, ending the session up by 0.88% to 1.262 points. But the irregularities among the various sub-segments still are the new “regularities”, with Capesizes (larger ship sizes of 150,000 tons) still earning significantly lower daily income than their smaller counterparts. Up until recently, this had been the case with Panamaxes, with the gap among the two markets, now being among the largest recorded. But, the Supramaxes good fortunes during the past couple of weeks, has helped the even smaller and more flexible ships of this type, to edge forward and surpass even the Capesize segment. The relative Baltic Supramax market is now standing at 1,418 points (+1.43% on the day), versus just 1,314 points of the Baltic Capesize Index.

According to the latest weekly report from Shiptrade Services, on the capesize market iron ore majors are once again out of play this week with new cylcones hitting major ports in Australia. “As a result hardly any fixtures were concluded. The negative freight market, further burdened by the rising bunker prices is shrinking owners returns, who more
often than not have been considering pulling their vessels out of the market until the it picks up again. On the other hand the period market has been quite active this week with good returns, as a result, it often stands as a good alternative to owners” the shipbroker said.

Regarding the booming as of late Supramax market, it mentioned that “the sentiment was positive this week in the Mediterranean, mostly for trips to the US as well as the Continent as a result of fresh cargoes entering the market and a rush of activity deriving thereof. Rates in the Atlantic mainly stayed at similar levels to last week with little fresh enquiry recorded within the Atlantic. The Pacific continued its improvement this week with much activity being directed towards India. Rates have been rising in the spot market as a result. Here too the rise in the paper market has given rise to some significant gains in the short period rates. However many doubt the longevity of this positive sentiment” it said.

As for the Panamax market, it has softened in the Atlantic since last week, with grain demand noted then from the ECSA, now fading, thus resulting in dropped rates. “In the Pacific, the sentiment was mixed with few NOPAC round being concluded while rates hovered at similar levels to last week. On the other hand, the paper market firmed up giving rise to higher returns in the short period market. Finally, in the smaller HandySize market, no significant change has been recorded since last week. The Atlantic healed more or less steady with a generally balanced supply ratio. A spike of activity was seen in the Pacific for trips to the USG and ECSA boosting rates for backhaul trips by over 20% .

In terms of ship purchasing activity, Shiptrade noted that purchase interest has been reduced compared to the previous week. “The Asia markets are holding the leading position, followed by Greek and other markets. In the dry sector, purchase interest concentrated on Handysize, Handymax and Panamax vessels. Furthermore the market is still trying to find a consensus and an equilibrium point with regard to price estimation differences between what buyers are willing to pay for vessel acquisitions and on what levels sellers are willing to sell.

In this regard it would be helpful to mention that although for quite some time we have not witnessed a deal in the late nineties built handymaxes, market rumor has it that a large Japanese handymax bulk carrier built 1996 has been committed to Asian buyers, who were willing to pay a firm very high teens for her” concluded the report.
Source: Nikos Roussanoglou, Hellenic Shipping

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Baltic index rises, capesize market seen pressured

Monday,28 February 2011

he Baltic Exchange's main sea freight index, which tracks rates to ship dry commodities, turned barely positive on Friday, although sentiment was expected to remain weak due to a glut of vessels.

The index rose 0.24 percent or 3 points to 1,245 points, after falling in the four previous sessions. That slump followed ten days of gains.
"The main drag on rates this week was a lull in Chinese iron ore fixtures due to record stockpiles," said Jeffrey Landsberg, managing director of dry bulk consultancy Commodore Research. "This affected capesize rates.
"Gains are certainly possible for the coming week," he said.

Earlier this month before the modest rally, the index, which tracks the cost of shipping key commodities such as iron ore, cement, grain, coal and fertiliser, reached its lowest in two years.
The Baltic's main index has remained erratic since 2009 because of swings in Chinese demand for iron ore, the primary ingredient of steel.

"Since the capesize debacle has begun, $4,500/day to $5,000/day has been the artificial level that owners have maintained as a floor for average capesize rates," Landsberg said.
"Despite capesize vessel supply exceeding demand, owners have resisted chartering out their capes when rates have reached current levels."
The Baltic's capesize index .BACI fell 0.3 percent, with average daily earnings dropping to $4,653 in an ninth session of falls. Capesizes typically haul 150,000 tonne cargoes such as iron ore and coal.

"Capes in all regions are apparently unable to shake off the problems presented by significant oversupply and activity remains too limited to provide any boost in rates," Braemar Seascope said.
The Baltic's panamax index .BPNI fell 0.06 percent, with average daily earnings dropping to $14,530, falling for a fifth day after 12 sessions of gains previously. Panamax vessels usually transport 60,000-70,000 tonne cargoes of coal or grains.

"Grain fixtures have been slow to emerge, with Chinese buyers remaining quiet," Braemar said.
Adding to economic headwinds in western industrialised countries, a major source of shipping demand, are inflationary fears in China, which could potentially lead to further interest rate rises and a pullback in demand for ore, delivering another setback for shippers.

China's consumer confidence index dropped in the fourth quarter, the second consecutive quarterly decline, as expectations for rising prices hurt sentiment. While there are indications of some vessel cancellations and delays, analysts expect deliveries to gather pace between 2011 and 2012.(source: Reuters)

Return of Australian coal exports key to freight recovery: Genco

Friday, Feb25, 2011 617 am EST/1117 GMT

New York (Platts)

A return of export volumes of coking coal from the east coast of Australia and in iron ore volumes from Brazil could lead to a recovery of Capesize freight rates during the course of 2011, New York-listed dry bulk ship owner Genco Shipping & Trading said Thursday.

Speaking at the company's fourth-quarter earnings call, Robert Buchanan, president of Genco, said the disruptions caused by the severe flooding in Queensland in December and January and weather-related delays to iron ore shipments from Brazil and South Africa, accounted for approximately 5% of global coal and iron ore seaborne trade, quoting estimates from commodities and ship broking group ICAP.

He also said that a cold winter with high snowfall in the US had limited the amount of coking coal shipments from the US east coast to make up for shortfalls of shipments from Queensland.

Earlier Thursday, Asian coal consumers told Platts that Rio Tinto had lifted a force majeure on its Kestrel semi-hard coking coal brand after almost two months. A Rio Tinto Coal Australia spokesman confirmed that force majeure had been lifted from both the Blair Athol Mine in Queensland and from the Kestrel Mine.

Kestrel is believed to be the first major Australian coking coal brand to have a force majeure lifted since the flooding.

The Kestrel mine supplies 4.2 million mt of coking and thermal coal to customers worldwide.

Buchanan said the expected influx of new ships from the shipyards this year may not be as bad as appeared on paper, because of the likelihood of up to 40% slippage in delivery schedules, following a trend seen in the last few years.

He conceded that the effect of China's tightening monetary policy, in terms of increasing the capital reserve requirements of banks, and the Korea Lines bankruptcy were having a negative effect on sentiment, "but this is reflected more in the forward market."

Genco does not have any exposure to Korea Lines, which filed for the equivalent of bankruptcy protection on January 25. Korea Lines is one of Asia's largest operators of dry bulk tonnage and, according to analysts, fell victim of the collapse in freight rates, having chartered-in its fleet at much higher rates than can be obtained by re-letting the ships on the spot market.

Buchanan also predicted a hefty increase in the scrapping of dry bulk carriers, saying that 2.1 million dwt of dry bulk tonnage had already been scrapped this year compared with 5.7 million dwt in the whole of 2010.

"According to our internal company estimates, we calculate that the cash breakeven for [a fully amortized], 20-year-old Capesize is approximately $12,500/day," said Buchanan. However, the freight market is showing returns of around $4,000-$5,000/day.

Buchanan said it is the larger ships that get scrapped first, because of the wear and tear they endure compared with smaller vessels. "Think about the length and the twisting of the steel that goes on and add iron ore into the equation," he said. Iron ore exerts more stresses on the hull of a dry bulk carrier than any other cargo type.

He said that with a Capsize approaching 20 years of age, and its fifth special survey at a cost of around $3 million, with another special survey due every 2.5 years thereafter, several owners might decide that it is better to sell for scrap.

Buchanan said that 21% of the dry bulk fleet was more than 25 years old and 28% was more than 20 years of age.

He said prices offered by ship breakers were around $500/light displacement ton. "As long as the price of steel stays firm, the scrap price should stay firm," he said.

On Wednesday, Genco reported fourth-quarter net attributable income of $34.8 million, down slightly from $35.5 million a year earlier. In the full year it reported net income of $141.2 million, down from $148.62 million.

Genco saw Q4 voyage revenues climb to $129.9 million from $96.2 million a year earlier, helped by an expansion in its fleet. Total revenues were $130.7 million, up from $96.2 million a year earlier. In the full-year, voyage revenues rose to $447.4 million from $379.5 million in 2009. Total full-year revenues were $448.7 million, up from $379.5 million in 2009. (By Platts)

Dry bulk market keeps losing ground, Capesizes suffering - Nikos Roussanoglou,Hellenic Shipping

Thursday,Feb24, 2011

The dry bulk market lost further ground yesterday, as the industry’s benchmark, the Baltic Dry Index was rapidly falling, ending the session down by 2.03% to 1,253 points. As has been the established trend so far this week, the bigger ships have been taking the biggest toll, with Capesizes losing 3.24 percent on the day to just 1,345 points (Baltic Capesize Index), with daily rates still below break-even point, while the Panamaxes have also seen thin demand, with the Baltic Panamax Index retreating yesterday by 3.86% to 1,845 points, which is still way above the capesize segment, in yet another odd signs of the current times. On the positive side, Supramax owners have been enjoying the current robust demand for their carriers, with their rates up by 1.91% on the day.

Commenting on the Capesize market, Fearnley’s latest weekly report said yesterday that although there was a little more activity last week, this has slowed down and rates have fallen slightly. This combined with increased bunker prices result in even lower returns for owners. Despite an increasing number of vessels not trading the oversupply is still the major problem, and with new cyclones hitting major loading ports in East Australia the market becomes even more frustrated. Presently owners are willing to fix out their tonnage at usd 16000 per day for 12-month period, which is a considerable premium over the spot market, but these are new record low levels for this kind of fixture.

On the Panamax front it mentioned that “the positive trend from last week gradually faded out, lead by lack of fresh USG/ECSA grain requirements in the Atlantic, a sliding forward curve followed by a falling period market in the Pacific. Despite prompt vessels under pressure still some healthy numbers achieved in the Atlantic; typically 25000 + 500BB for Fronthaul and mid teens for transatlantic rounds. The Pacific saw rates coming off significantly to lower teens for Nopac rounds and a growing spread between spot- and period rates.

Charterers and operators are holding back and reducing their activity. Takers for longer periods clearly stand off as the forward curve test very low teens and most Owners still hope for a recovery to do high teens for same. On a positive note there is growing local enthusiasm with the commencement of the Nordic World ski championships in Oslo” said the shipbroker.

Meanwhile, the container market has yet to “recover” on the news of Maersk’s huge newbuilding order for 10 firm plus 20 optional 18,000 TEU container vessels. AP Møller has been in talks with DSME regarding the 18,000 TEU design for quite some time, and now finally confirmed. According to AP Møller, these vessels will burn 35% less fuel per container compared to the more standard 13,000 TEU container vessels operating today. In another report on the newbuilding market, Clarksons said that with the holidays now firmly behind us we continue to see the yards reporting new business being concluded. “As previously discussed, container enquiries in particular look to be the leading factor in generating this momentum as dry and wet remains relatively stagnant. With the container story continuing to press forward - this is ultimately inhibiting the shipyards willing to push pricing on other sectors and attempt to bridge the bid offer spread, that continues to stifle the potential for further volume.

In the short term, we don't anticipate this dynamic to change - and yards will want to exploit the shipbuilding demand that exists outside of dry and wet - and try to extend their forward orderbook coverage and take the pressure off themselves to yield to what is a weaker demand story so far. In terms of reported business; In Dry, Hanjin Shipping have contracted a pair of 180,000dwt Capesize bulk carriers at Daehan, these are scheduled for delivery in 2012 and the reported price for these is USD58.5 Mill per vessel. In China meanwhile, it has been reported that Shanhaiguan have won an order from Greathorse Shipping Holdings for 4 option 4 x 76,000dwt panamax bulkers, with the firm vessels due to deliver in 2H 2012 and 1Q 2013. It is understood that these vessels may have been signed at the end of last year and are only fully coming to light now” said Clarksons.

Source: Nikos Roussanoglou, Hellenic Shipping


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Supramax market is improving in the pacific

Tuesday,22February,2011

BRS - A 10% rise in the BDI this week, mostly on the back of Panamax rates and improvements in the Supramax market in the Pacific. For the Capes, rates rose slightly but it was an inconclusive week. Adding to the uncertain situation in India, Chhattisgarh state, which produces around 20% of India's iron ore reserves, this week became the latest to threaten a possible ban on exports after the state’s chief minister appealed to the Indian prime minister. The region has only one ore miner, state-owned NMDC, so a decision on a ban would have to be made by the federal government. Karnataka’s ban on exports from private firms is currently being appealed in the Supreme Court, but has already resulted in a significant drop in exports from the country.

Capesize
Although Chinese New Year is now well and truly behind us, there has yet to be a significant recovery in Capesize rates. Rates rose Friday to Friday but started another downward slide towards the end of the week. At US$ 6,620 per day on Friday, the 4TC is still lower than rates before the holiday. Widespread tonnage availability continues to be the main issue, particularly in the Pacific, and the only route to show any real rate increase was Brazil-China. There was no period activity to report, and in the FFA market Q2 has now dropped from US$ 21,000 levels to US$ 17,500. The BCI recorded another drop on Monday.

Panamax
The Panamax market this week continued in the same vein as last week, boosted by a firm Indian market; the 4TC average closed on Friday at US$ 16,000 per day, up US$3,000 compared to a week ago. The route paying the most was the WCI/ China trade where a standard Tess 74 managed to fix at US$ 22/23,000 per day. The Nopac itself was closer to US$15,000/ day, representing an increase of around US$ 4,000 compared to last week’s level. The India buzz had an impact on TA round rates and especially in the ECSA area. But by the end of the week we noted a decrease in activity, with a still quiet ECSA grain export market and high ship availability. The TA round ended the week at US$15/16,000 per day. Period wise, numbers increased as well and operators were taking ships in at around US$18,000 per day ie an increase of US$2,000 compared to the previous week.

Supramax/Handy
The Baltic Supramax Index has continued to rise throughout the week as activity picks up steadily after the Chinese New Year. Despite this rise, one wonders whether the improvements will last. The BSI gained 113 points to finish at 1,267 points last week, while the average of the time charter average gained US$1,184 to finish at US$13,247. The USG and NCSA were the most active areas, and modern Supras were fixed at in the low/ mid US$20,000s back to the Continent/Med. Supras were paid around US$25,000 for delivery west coast central America. The Continent has also been active with fixtures reported to various destinations including the Far East in the very high US$10,000s, and a couple of laden legs within the Atlantic in the mid US$10,000s. Little emerged from South America on the Supras. The Baltic has also been on the rise for smaller sizes and the BHSI gained 19 points last week to finish at 670, while the average of the time charter gained US$304 to finish at US$9,906. East coast South America has been more active mainly with grain fixtures to the Continent and Mediterranean in the mid to mid/high US$10,000s depending on vessel age. From north coast South America vessels were fixed at US$15,000 for Continent redelivery and modern Handies were rumoured fixed at US$10,000 from the eastern Med to west Africa. Modern Supras were fixed in the mid US$10,000s level for 4-6 months period with delivery Far East. The Pacific was also on the rise with Supramaxes ex Japan to Australia/Nopac gaining US$2,386 to end the week at US$10,791. Supras open in China for a trip to Indonesia with redelivery India were paid a touch below US$10,000.

Source: Barry Rogliano Salles
Tags: FFA market, The Panamax 4TC, The Panamax index, The Baltic Supramax Index, The BSI, vessels, Global freight rates, Indonesia, India, China, America, Africa

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Global freight rates poised to rise after tumbling to a 2 year low

Monday, 07 Feb 2011
Bloomberg reported that freight rates are poised to rise after tumbling to a two year low as owners of ships hauling coal and iron ore scrap the most vessels in at least 28 years.
According to Clarkson Plc, a total of 38 Capesize, will be demolished in 2011.
Charter costs should average USD 22,000 in 2011, almost four times today’s rate of USD 5,724.

Mr Philippe van den Abeele MD of Castalia Fund Management (UK) Limited said that "From where we are now I don't see much downside. People are depressed, they think it’s the end of the world in dry cargo shipping, but they’re pushing it too far."
A Bloomberg survey of eight fund managers and analysts last month showed that owners of older vessels may sell them for scrap because earnings from single voyage charters were slashed by a four week, 71% slump in rates. The most demolitions since Clarkson's records begin in 1983 may help reduce a glut as an estimated 200 new Capesize, spanning about 35 miles laid end to end, leave shipyards this year.

Mr Van den Abeele's forecast for this year's average rate is at least 22% higher than any of the quarterly forward freight agreements being traded for 2011. The accords, traded by brokers, allow investors to hedge or bet on the future cost of shipping.
According to the Baltic Exchange, companies ordered too many ships in 2007 and 2008, when daily income averaged about USD 111,000. Rates reached a record USD 233,988 in June 2008 before plunging 99% over the next six months to USD 2,316.
Korea Line Corporation, South Korea's second largest operator of dry bulk ships, filed for receivership last month after reporting losses in six of the past seven quarters. The 12 member Bloomberg Dry Ships Index fell 4.5% this year, extending an 8% drop in 2010, with the biggest declines for Genco Shipping & Trading Limited and Eagle Bulk Shipping Inc.

Mr Nigel Prentis director of research and consulting at HSBC Shipping Services Limited in London said that owners of capsizes valued at USD 60 million are paying about USD 25,000 a day in costs to cover expenses such as crew and financing. Single voyage rates have been below that level since December 20th 2010.
The Baltic Exchange reported its first ever negative rate for dry bulk freight on January 13th 2011. Costs on the C11 route for shipments to Europe from Asia are now at minus USD 2,227 a day. While that means owners pay customers to hire their vessels, clients still pay most of the fuel costs. For a shipping line wanting to relocate a vessel to a region where there are more cargoes, that’s still cheaper than sailing the craft empty.(sourced:bloomberg.net)