8.18-8.22Global Dry Bulk Market Weekly Comment

2014-08-26

A close examination of recent spot chartering activity shows that 90 dry bulk vessels were chartered in the spot market last week. This is 36 less than were chartered during the previous week. Last week's vessel chartering activity included the chartering of 49 capesize vessels (3 less than the previous week), 21 panamax vessels (27 less than the previous week), 16 handymax vessels (the same amount as the previous week), and 4 handysize vessels (6 less than the previous week). Dry bulk freight rates found more support last week despite less vessels being chartered. This is because vessel availability has become tighter, which is great for rate prospects for the upcoming weeks and months. Capesize rates ended last week averaging $16,031 /day, an increase of $1,640 (11%) from a week ago. Panamax rates ended last week averaging $6,467/day, an increase of $70 (1%) from a week ago. Supramax rates ended last week averaging $9,797/day, an increase of $627 (7%) from a week ago. Handysize rates ended last week averaging $6,120/day, an increase of $457 (8%) from a week ago.

Looking at dry bulk cargo trends in specific detail, a particularly large amount of Australian iron ore cargoes and South American grain cargoes surfaced in the market last week. In total, 24 Australian iron ore cargoes surfaced in the market last week. This was 6 more than surfaced during the previous week. The Australian iron ore cargoes will be shipped to various buyers in Asia -- primarily to buyers in China. Overall, Chinese demand for imported iron ore has remained very strong. In addition, 12 South American grain cargoes came to the market last week. This is 1 more than surfaced during the previous week. The South American grain cargoes will be exported to various buyers in around the world.

Recently released data shows that approximately 5.9 million tons of crude steel was produced in South Korea last month. While this is down slightly from the 6 million tons produced in June, it is up by approximately 400,000 tons (7%) from production seen during July 2013. In total, the first seven months of this year have seen South Korean crude steel output total 41.7 million tons. This is 3.4 million tons (9%) more than was produced during the first seven months of last year. In addition, 7 million tons of crude steel was produced in India last month. This is 300,000 tons (4%) more than was produced in June and also approximately 300,000 million tons (4%) more than was produced in July 2013. In total, the first seven months of this year have seen Indian crude steel production total 48.3 million tons. This is 2.2 million tons (5%) more than was produced during the first seven months of last year. Steel production has remained high both in China, as well as in many other steel producing nations. This continues to lead to robust demand for imported iron ore, which most supports the capesize segment of the dry bulk market.

Charts are attached (data is in million tons).

Source from : CNSS

HEADLINES