20-27 May 2005 weekly market report..Banchero Costa

20-27 May 2005 weekly market report..Banchero Costa

Capesize (Atlantic and Pacific) No stopping the drop in the Capesize market: the week ended with the BCI index very close to 4'000 (precisely 4'089) with a loss of 558 points which together with the 692 points lost the previous week add up to 1'250 lost in ust 15 days. The Atlantic keeps showing contradictory signs but with a downward trend, while in the Far East we have seen a crash especially on prompt positions where available tonnage is abundant and find it hard to find employment except by accepting rates ever further discounted both voyage and Tc basis. The round Pacific is down to $38'000 for modern 172'000 while the Trip Back smashed level $30'000 pushed by cargoes ex-Richards Bay which are down below $14.00. The 4 T/c routes index is down to $43'685, a loss of as much as $7'666 Friday to Friday which says much about the present market and future prospects, at least in the short run. Point to notice that the 4 T/c routes lost since the $77'000 peak last January as much as $33'000 i.e. about 57%. Panamax (Atlantic and Pacific) Despite the softer tone at the beginning of the week, there was more resistance from owners, especially those with early tonnage in the Atlantic, supported by a more active South American market and some quick fixtures of spot/prompt tonnage. In the Pacific, although at the very end of the week we saw signs of a possible turning of the market, failed to get any such lift. As usual, the fate of the Panamaxes is still very much in the hands of the cape markets. Handy (Far East/Pacific) The spot market remains quite soft both for handymax and handy sizes with still too much prompt tonnage available around and not enough demand from charterers, to the contrary short period employment keeps getting done at much better rates and Korean charterers took a boat for 2 years straight employment which appears even better. Handy (North Europe/Mediterranean) Requirements from the Continental area are still few, luckily the smaller amount of tonnage available has so far prevented the levels to collapse but rates are decreasing especially for handymaxes. Less for handies. Tonnage in the Black Sea is still lacking but the volume of requirements has decreased as well so rates may be falling a bit. Handy (US/N. Atlantic/Lakes/S. America) Handymax rates achievable in the US Gulf are slowly picking up both for single trips and short period fixtures for which owner strictly demand for Atlantic redelivery. Handies in this area are suffering a bit to find employment. Negotiations for South American loading business are developing quicker revealing some anxiety from owners to fix before it could be too late. Handy (Indian Ocean/South Africa) Activity around these waters has been very quiet with a very sleepy South African market, Indian iron ore requirements to Far East fading away and a very poor demand for tonnage all around. Owners open in the eastern coast of India are now again looking for west Australia loading opportunities. Banchero Costa