International Grain Future Freight (May.8-May.12)

May 18, 2017

Week 19, 2017 (May 8-May 12), the International Grain Future Freight (IGF) reported the Panamax forward freight rate of U.S. Gulf-Tianjin route (soybean) from Oct. to Dec. in 2017, and the trend is shown in the chart below.

The good harvest of South America soybean was deemed and the focus of market transferred to American soybean. The U.S. Agriculture Department predicted the sowing area in 2017/2018 year would be 89.48 million acres which was much higher than 83.40 million acres of last year. The predicted sowing area increased 8.7% on a year-on-year basis which was the biggest increase in the last three years. In the last of April, the sowing of U.S. soybean begun and the progress was faster than last year. But due to the continuous rain in the middle-west area, the progress of soybean was 14% which was below the five-year average 17%.

In terms of the shipping market, the future freight rate market was $34.00/ton from May 8 to May 10 (Mon. to Wed.). From May 11 to May 12 (Thu. to Fri.), the future freight rate increased. The freight rate was closed at $34.50/ton with an increase of 1.47% from May 5 (the last release day of week 18).