Amid geopolitical tensions and the “constrained” Strait of Hormuz, the dry bulk market demonstrated resilience, maintaining a positive trajectory throughout August. As always, Capesizes recorded the highest volatility, while changes across the other segments remained in the single digits. Let us take a closer look at how the market performed by vessel segment and geographical region.
More specifically, Capesizes increased by 25.33%, Kamsarmaxes by 6.53%, Ultramaxes by 4.52%, and Handies by 2.98% compared with the previous month. As a result, the Baltic Dry Index (BDI) gained 539 points on a monthly basis, closing at 3,628 points on Friday, September 4.
Let us examine in greater detail the performance of the dry bulk market by vessel size, starting with Capesizes.
Capesize: tightening tonnage drives gains across both basins
In Asia, the downward trend seen at the beginning of the week did not last long, as the presence of miners and the decline in available tonnage provided support to the market. As a result, freight rates gained $3 per tonne during the week. The index levels on the Australia–China route (C5) closed on Friday at $19 per tonne.
In the Atlantic, gains were recorded in both the south and the north, amid declining tonnage availability and stronger demand relative to supply, particularly for voyages to Asia. On Friday, the indices stood at $41.5 per tonne for the Brazil–China route (C3), while rates for voyages from Europe to Asia closed at $93.11k per day (C9), and transatlantic round voyages at $59.2k per day (C8).
Kamsarmax: Asia accelerates as Atlantic momentum turns uneven
In the Atlantic, and particularly in the north, the market showed a positive picture during the first half of the week. However, the lack of replenishment of cargoes during the second half led to a decline in freight rates. In the south, the picture was more favourable, with owners enjoying plenty of options, although activity slowed towards the end of the week.
Indicatively, rates for voyages from the East Coast of South America (ECSA) to the Far East were assessed at $20–22k per day (delivery Asia), from Europe to Asia at $30.5–32.5k per day (delivery Europe), while transatlantic round voyages ranged between $20.5–22.5k per day (delivery Gibraltar).
In Asia, significant gains were recorded as the market was supported by cargoes from eastern Australia and the North Pacific. Further support came from forward expectations, FFAs, as well as the rise in Capesize rates. Rates for round voyages in Southeast Asia and the Far East ranged between $19–21k per day (delivery Far East).
Ultramax: Atlantic strength builds as Asian markets hold firm
In Southeast Asia, the market remained at broadly the same levels, as both owners and charterers held firm to their positions. Ultramax rates for voyages between Southeast Asia and the Far East were assessed at $18.5–20k per day.
Further north, in the Far East, the market improved, with activity increasing and more cargoes appearing in the North Pacific or for backhaul voyages. There was also increased interest in period charters. Ultramax rates for round voyages in the NOPAC were assessed at $17.5–19k per day, voyages to India at $21.5–23k per day, and backhaul voyages to the Atlantic at $18.5–20k per day.
In the Middle East Gulf and West India, the market maintained its momentum, particularly for prompt tonnage, which remained limited. In addition, several new fixtures were concluded at satisfactory levels. Rates for voyages to the Far East ranged between $14.5–16k per day (delivery WCI).
In the Atlantic, and particularly in the U.S. Gulf, the market strengthened as fresh grain and petcoke cargoes emerged, while tonnage supply remained tight. Ultramax rates for transatlantic voyages were assessed at $31.5–33k per day, while rates for voyages to Asia stood at $32.5–34k per day.
The ECSA market started the week quietly, as some areas were affected by holidays. Activity returned during the second half of the week, with momentum picking up on the back of improvements in the Panamax segment. Rates to Southeast Asia and China were assessed at $34.5–36k per day, while transatlantic voyages to the Mediterranean and Europe were fixed at $30.5–32k per day.
The European market started the week quietly; however, as the days progressed, it steadily gained ground, supported by a consistent flow of cargoes and a healthy volume of fixtures. Rates for intra-European round voyages were assessed at $22.5–24k per day, while scrap runs to the Mediterranean were at $24.5–26k per day and voyages to Asia at $24.5–26k per day.
The Mediterranean remained broadly unchanged, as the Eastern Mediterranean experienced declining demand, while the western basin was weighed down by a number of repositioning vessels moving into the region. Indicatively, an Ultramax trading from the Mediterranean to Asia was fixed at $23.5–25k per day (delivery Çanakkale), at $11–12.5k per day for voyages to the other side of the Atlantic, and at $14.5–16k per day for intra-Mediterranean voyages (excluding war zones).
Handysize: ECSA strengthens while regional imbalances persist
In Europe, the market displayed mixed trends. On the one hand, we saw a slight increase in cargo volumes for the second half of the month; however, a considerable number of vessels were still seeking employment. Rates for the larger vessels in the Handysize segment were assessed at $14.5–16k per day for round voyages, $18.5–20k per day for scrap runs to the Mediterranean, and $9.5–11k per day for transatlantic voyages.
The Mediterranean market moved at two speeds. On the one hand, fixtures for prompt dates remained broadly at the same levels, while rates for later dates increased. Rates for larger Handysize vessels (above 36,000 dwt) were assessed at $10.5–12k per day for intra-Mediterranean voyages, $9.5–11k per day for voyages to Europe, $8.5–10k per day for voyages to the other side of the Atlantic, and $15–16.5k per day for voyages to Asia, with delivery Çanakkale.
In the U.S. Gulf, the market moved at a slow pace during the first half of the week, continuing at the levels seen the previous week. During the second half, more cargoes emerged and charterers raised their ideas. Rates for the larger vessels in the Handysize segment were assessed at $15–16.5k per day for voyages to the other side of the Atlantic and $15.5–17k per day for voyages to Asia.
The East Coast of South America (ECSA) started the week on a positive note, with the overall sentiment pointing towards further gains as new cargoes continued to emerge. Rates for transatlantic voyages to Europe and the Mediterranean were assessed at $23–24.5k per day, while voyages to Asia were at $22.5–24k per day.
In Asia, and particularly in the north, interest was focused on certain southbound voyages or backhaul employment. In the south, a balance between demand and supply prevailed, while activity remained steady. The main support came from Australia, with a consistent flow of cargoes.
Further west, in the Middle East Gulf and India, demand remained subdued, with a large concentration of tonnage in Oman and West India. Rates for larger Handysize vessels on round voyages in the Far East and NOPAC were assessed at $17.5–19k per day, while voyages from Southeast Asia to China were at $18.5–20k per day, and West India–China voyages at $8–9.5k per day.
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This report is provided solely for general informational purposes and does not constitute investment or commercial advice. The information herein is based on sources believed to be reliable but is not guaranteed for accuracy or completeness. Any actions taken based on this content are the sole responsibility of the reader.