17 - 24 March 2006 weekly market report..Banchero Costa

Capesize (Atlantic and Pacific) The Capesize market continues between highs and lows: after the decline of the previous week, this week went under a positive sign with a progress of 255 points on the BCI index. Both in the Far East, where there has been more optimism, although not what owners were expecting, as well as in the Atlantic, where the market has shown more flexibility on the upside both on iron ore for China (we saw rates going from $23 up to exceeding $24) as well as basis t/charter where a standard Hyundai type 161,000 dwt fixed for $48,500. Towards the end of the week we assisted to a decrease in the number of cargoes quoted on the market and, given that the list of tonnage, especially in the Far East, is getting longer, we don't believe that the rally can continue and expect renewed weakening. Panamax (Atlantic and Pacific) After a depressed period, and just when everyone was expecting the Atlantic to continue on its downward trend, the market stopped and the rates steadied. The supply of early tonnage shortened and the Atlantic round voyage was revaluated back at around $17,000 daily. Owners were then asking for a premium to go East especially from South America with rates jumping in a very short time at level above $20,000 daily. In the Pacific, after a calm period, the week started with a quick reversed trend. North Pacific rounds fell to $16,500 per day but then recovered to levels approaching $19,000. A similar trend was registered on the run back to the Atlantic. $23,500 were paid for modern CO2 fitted tonnage to load oilcake ex-Thailand followed by a rate of $16,000 paid to modern tonnage delivery Japan trip via Indonesia with coal back to Immingham. By the end of the week this backhaul route had strengthened to $18,000. Handy (Far East/Pacific) A few single voyage fixtures emerged to have been concluded at lower levels. The backhaul ones could be influenced by the better trend going around part of the Atlantic markets; the local ones are a little more worrying. The end of the week brought up charterers' renewed interest for period deals together with a few already concluded fixtures at good enough levels which so far blew away any pessimistic developments. Handy (North Europe/Mediterranean) At the start of the week smaller money was agreed to carry steel from the Continent to the United States, and the scrap charterers showed less interest from the area. This little crisis stabilized throughout the week but not the volume of the fresh enquiry kept smaller. Rates from the Black Sea are picking up, but very slowly. Owners efforts to push market up are still a little vain due to the scarce demand. Handy (US/N. Atlantic/Lakes/S. America) While the market in South America is still keeping its stability, the US Gulf is slowly building up. Present results are still influenced by positional situations but nice money was pay for a handymax to the Continent and even STX Pan Ocean, traditionally clever in booking in tonnage for their large Mississippi/Far East grain contract, had to pay more on last concluded early April booking. More enquiries are quoted. Handy (Indian Ocean/South Africa) Rates may not be as firm as a couple of weeks ago but the iron ore fixing from India to China keeps up nicely still washing away most of the tonnage in the area. The South African market became a little more active and with no owners even daring to begin sending tonnage from the Indian Ocean to load down there, charterers have to grab the few East African open positions. Banchero Costa and Co Spa Mail: research@bancosta.it Web: www.bancosta.it