Freight market update..US Chartering Company

Freight market update..US Chartering Company

Freight rates continuing to surge: Panamax ------- The Index went up 583 points over the week, reflecting the spot Atlantic market moving to new highs and the period sector firming in expectation of further demand for tonnage. Further gains may be expected as the market reacts to the upsurge in Capesize rates over the last 24 hours. LME tonnage is now securing $55'000 daily for delivery Continent trip to Far East and close to $50'000 daily for Atlantic rounds. The emergence of South American grain enquiry has added to the markets present insatiable appetite for tonnage. The Far East sector has been a little quieter but by the end of the week had improved to $45'000 for NoPac rounds on a 1997 built unit. New building tonnage is rumored to have fixed at $35'500 for two years, delivery in the summer. Tonnage is now asking $40'000 for this period. Rising freight, rising FOB prices, rising prices to the consumer leads to....!!! Handymax/Handysize ------------------ The fact that a number of smaller Handies remained spot out in the East for most of this week was ignored under an avalanche of euphoria sparked by yet another hike in rates over in the Atlantic. A chunk of Handies were taken out of the market early in the week for Atlantic rounds, with Cont/Med deliveries, leaving a pronounced deficiency of prompt tonnage. This only went to make the game of chase the ship even more frustrating for Charterers. Such is the present market Owners have no need to rate anything officially unless they fairly sure of being confirmed on their ideal business. As anticipated an imbalance is starting to build between the Atlantic and Pacific zones, quickened by events highlighted above. The real struggle has been to persuade Owners with prompt positions in the Atlantic to go East, hence many Handymaxs were only considering say Black Sea /China trips at well into $40'000 daily; obviously provocative pronouncements being $5-10'000 daily over the present BHMI posted rate. A 37'000 tdw grabber picked up $38'000 delivery East Med for a quick trip to India, while an early 80's 40'000 mtdw non grabber agreed $38'000 for a long trip to India. Cargoes from the US Gulf / Caribbean to Europe were plentiful enough to hike some 20-35'000t voyage rates over $60 per ton mark for slower load/discharge agriprods business to North Africa / East Med / Black Sea. Sentiment is for rates to go higher now that China is back in business.