June 12– 18 2010 Weekly market report.. Banchero Costa

Capesize (Atlantic and Pacific) Last week the Capesize market lost 1,142 points, which is about one quarter of the market value in just one week!! It is because of the large abundance of tonnage which is keeping spot, and newbuildings being delivered which always have an impact on the market, and the lack of fresh enquiries which currently are still missing both in the Atlantic and in the Far East. Further weakening is expected for the following week unless the iron or and coal needs will not improve drastically, as up to now it appears to be no floor to stop the market of Capesize ships. West Australia to China iron ore went close to $ 9.50, Brazil/China slipped down to $ 22.00 level with old ships and Brazil/Continent iron ore cargoes reported gone at very close to $ 13.00 and very limited fresh requirements which are also including the coal shipments from Colombia to the Continent and to the Far East. . Panamax (Atlantic and Pacific) A depressing week with a build-up of tonnage outstripping demand especially in the Pacific. Rates dropped all around. In the Pacific, as the week drew to a close there were signs of fresh inquiry but the market remained fragile and nervous. Short period fixing was limited. In the Atlantic rates came under pressure over the week but there seemed to be some tightening in supply and it seemed the market has found a bottom. Handy (Far East/Pacific) Supramax and handymax rates stayed in the high mid teens levels, respectively, for trips via SE Asia to India. A downwards adjustment to similar levels was also seen on the South East Asia rounds back to China. Owners of tonnage not equipped with grabs further suffered from the market as most of the local requirements left were calling for self-loading tonnage. On the other hand a couple of Supramaxes reported fixed for short period in the low usd 20,000’s level showed that owners were resisting to the downward trend and charterers have got confidence in a better future market. Owners’ choice to ballast a good number of larger units to the USG put pressure on charterers coming in the market with prompt requirements ex North Pacific and not finding tonnage in right position. At the end of the week positive rumours were heard about a Supramax fixing over usd 20,000 daily via SE Asia to India. Smaller Handies stayed at similar levels of the previous week, consequently fixing levels close to the larger units. Handy (North Europe/Mediterranean) Chartering activity was still very limited all around Europe. Handysizes were said to enjoy a firmer market from North Europe but evidence of concluded fixtures was missing. The market of South Europe was not exciting with tonnage available in the Mediterranean struggling to compete on the few fertilizer positioning cargoes to Central and South America, with others just ballasting across. Interest for charter tonnage for steels out of the Black Sea was very limited and also the grain export from the Ukraine was slower. The few concluded fixtures were kept confidential but owners of large modern eco types were said to be rating aggressively grain business to the Middle East. Handy (USA/N.Atlantic/Lakes/S.America) The number of larger units available for loading in the USG kept building up and rates were further poisoned by a number of ballasters from the Far East approaching Cristobel still unfixed. Several vessels ended up fixing for loading out of the North Coast South America and USG at lower numbers, with lower rates also agreed for tonnage taken in Gibraltar on a round voyage basis. Chartering interest was larger from South America with Supramaxes fixing low usd 30,000’s daily timecharter levels for delivery dop West Africa and redelivery Far East. A bigger interest for sugar cargoes Brazil/Europe washed away a few vessels from the market without bringing any real benefit to rates. Some better fixtures were rumoured to have been concluded from the USG to Europe while the week was approaching to its end. Handy (Indian Ocean/South Africa) Supramax coal from South Africa to India or MEG was probably the sole trade giving some life to this area even if achievable rates were scarcely attractive and tonnage fixed will end up again in the middle of nowhere market-wise. Indian iron ore export was idle with a sole fixture reported concluded at an acceptable enough level for owners who managed to take advantage from a positional coincidence. Banchero Costa and Co Spa Mail: research@bancosta.it Web: www.bancosta.it