Bulk report – Week 32
The Capesize market continues to dwell in the doldrums as any attempts to spark a rally were quickly dealt a hammer blow as the 5TC closed the week at $10,898. This rate level is less than a third of the same time last year. The market was reasonable active this week. The Pacific market had most of the majors requesting tonnage for their West Australia requirements. The C5 route fixed in the $8’s throughout the week, closing out at $8.085. The Atlantic region saw several flurries of Brazil cargoes for both the Far East and north to the continent. Fixture levels on these routes sharpened throughout the week, while some Transatlantic cargoes were heard to have been pulled in a wait-and-see situation. The Transatlantic C8 lowered Friday -2,028 to settle at $15,750, yet still a significant premium to the Transpacific C10 at $7,209. The dire rate levels at this time of the year are a strong signal of the poor demand current being seen.
The Atlantic was a stagnant affair this week. With limited activity emerging, the North Atlantic drifted over the course of the week. Despite a few signs of better rates midweek, however these appeared positional and rates continued to ease. EC South America also had a negative week, with September arrival cargoes few and far between, with talk of limited selling by the grain houses. In Asia a smattering of NoPac fixtures emerged mid-week ranging from $16,500 to $17,500 for a 82,000-dwt tonnage delivery to South Korea. Australian coal destined for India continued to pay a small premium, with deals concluded in the range of $17,500 and $18,500, whilst most of the activity came courtesy of trips via Indonesia with redelivery to South China hovering around the $14,000 mark over the week, although the latter part of the week had the rate pegged closer to $17,000 as pressure grew in the south of the region with tonnage count appearing tighter.
With the continued northern hemisphere holiday season and various national holidays in Asia, it was another lacklustre week overall. Limited fresh enquiry appeared in many areas leading to a build-up of prompt tonnage. However, as the week came to close positive sentiment reappeared in Asia, which saw more interest from the south. From the Atlantic, the US Gulf remained under pressure. A 63,000-dwt was heard fixed for a trip to China at $23,750, while a 55,000-dwt was heard fixed delivery Santos trip to Algeria at $29,500. From Asia, weaker sentiment saw a 56,000-dwt fixing delivery Kosichang trip via Indonesia redelivery South China at $10,000, but as the week closed a 53,000-dwt was heard fixed delivery Singapore trip via Indonesia redelivery China in the high $15,000s. A little more activity surfaced from the Indian Ocean, with a 63,000 fixing delivery Mombasa for a trip via South Africa redelivery Far East at $22,750 plus a $275,000 ballast bonus.
In a week punctuated by national holidays, the negative sentiment of recent times continued seeing BHSI drop below 1,000 points for the first time since January. With brokers speaking of a continued lack of fresh enquiry across both basins, the outlook for the near future remains bleak for owners in what is being described as a summer lull. In East Coast South America levels have been correcting day-on-day with a 35,000-dwt fixing for a trip from Santos to the Black Sea at $22,000 whilst a 35,000-dwt open in North Brazil fixed basis a laycan of 20-30 August for a trip to Norway at around $20,000. A 30,000-dwt was fixed from Santarem to Spain for an end of August laycan at $15,500. In Asia, a 35,000-dwt was fixed from Shenzhen via South East Asia to West Coast Central America at $18,000. A 32,000-dwt was fixed for two laden legs with Far East redelivery at $22,000.