11 - 18 November 2005 weekly market report..Banchero Costa
Capesize (Atlantic and Pacific) The market has kept a positive trend only until Tuesday, only to start declining, at times even sharply, until the end of the week, losing 135 points on the Baltic Capesize Index. In any case, it's not so much the current downtrend that's worrying the operators, as the future prospects and that's because it's the Chinese themselves who are rather pessimistic about their own imports till the end of the year, and what's more the prospects of the European steel mills are hardly positive, also in the waiting for any clearer news from the ore producers on possible price rises, while both the Chinese and Europeans are actually asking for a price cut. Also coal ex South Africa is down by almost a dollar due to the exorbitant number of vessels open in the Far East and those which decide to return to the Atlantic as soon as possible and therefore via Richards Bay. In essence, it is general opinion that there will likely be a new improvement at the start of December but the market will again decline due to the holiday period and that this negative trend will continue into 2006 mostly due to the excessive number of new buildings which will flood the market in the forthcoming years. Panamax (Atlantic and Pacific) It has been a very negative week for Panamaxes in both basins. The Atlantic was reported to have begun the week moving sideways; only to deteriorate inexorably as the week progressed. The Pacific has begun badly from the onset. The reason is quite simply a growing excess of prompt tonnage which the few new requirements are unable to absorb. At the end of the week there were still numerous vessels in ballast for the Atlantic. Charterers have preferred to hold back hoping to push rates further down. There is still interest in period, with period rates having softened, but still holding above spot rates. On Friday, trips east headed to the low $20.000's daily. In the Pacific NoPac rounds were close to $13.000 daily, while trips back around $11.500 daily. Handy (Far East/Pacific) There has been no increase in demand, while available tonnage keeps building up in this area. Most arrive with iron ore from the Indian Ocean, a trade which looks to have resumed significantly on the handymax sizes. The majority of the trade is concentrating on local business, the few luckier owners able to grab backhaul business are getting fixed at quite unexciting rates. Charts take advantage by finalizing period fixtures at better rates. Handy (North Europe/Mediterranean) The area appears quite in standby, with fewer requirements and charterers trying to push them ahead so to lower down rates both from Continent and Black Sea. Handy (US/N. Atlantic/Lakes/S. America) Some sort of sideway trend is affected American Atlantic business, with the area becoming more positional. Smaller handies have still enjoyed a better market in these waters. South Africa is keeping firmer, although the possibly expected market boom didn't show up. Handy (Indian Ocean/South Africa) Chinese interest for iron ore has concentrated to the handymax sizes, which are more frequently fitted with grabs and still not that expensive for trips out of India due to the on-going excess of tonnage available. Agreed rates; however, have shown to be a little firmer. Banchero Costa