Global spot chartering activity increased by a significant amount last week, which allowed capesize and panamax rates to find a moderate amount of support while supramax and handysize rates were able to hold basically steady. A total of 109 dry bulk vessels were chartered in the spot market last week, 14 more than were chartered during the previous week. Capesize rates have increased as a large amount of capesize vessels have continued to been chartered to haul iron ore cargoes. Panamax rates have increased as a large amount of coal and grain cargoes have also continued to surfaced in the market.
In China, steel prices have continued to increase while steel stockpiles have continued to decline -- which are both encouraging developments. The average price of 3.0mm hot rolled coil in China has increased to 3,710 yuan/ton, 40 yuan (1%) more than a week ago. Chinese steel prices have now increased during four of the last six weeks. Stockpiles of flat and construction steel products in China currently total approximately 16.5 million tons, 400,000 tons (-2%) less than a week ago. This marks the ninth consecutive week that Chinese steel stockpiles have decreased. The decline in stockpiles is encouraging as more steel in China is being consumed.
In the grain market, South Korea has fully resumed importing US wheat and it is likely that US wheat exports to Japan will fully normalize soon as well. In addition, the United States Department of Agriculture (USDA) has released its latest forecast for global grain trade and predicts that 320.7 million tons of grain will be exported worldwide during the current 2013/14 grain trade marketing year. Compared with 294.2 million tons of grain estimated to have been exported during 2012/13, 2013/14 grain trade is projected to increase by 26.5 million tons (9%). The USDA's forecast has been raised mostly due to loftier expectations for global wheat exports. The USDA now predicts that 149.1 million tons of wheat will be exported worldwide in 2013/14. This is 10.8 million tons (8%) more than was exported in 2012/13.