March 16, 2020 – March 20, 2020 Weekly market report.. Banchero Costa

Tuesday, 24 March 2020 16:41:39 (GMT+3)   |   Istanbul

Capesize (Atlantic and Pacific)

Due to the falling bunker prices rates dropped, but TCE increased quite significantly gaining almost $1,500/d from Friday to Friday. Tubarao-Qingdao was still under pressure losing almost $1/mt in a few days and from mid $10/mt to high $9/mt for mid April laycan. Brazil RV was stable around $2,250/d. W Australia-Qingdao was swinging with rates that went from $4.45/mt to $4.30/mt after bottoming at $4.20/mt on Thursday for early April laycan. Pacific RV rates remained for all week in the mid/high $3,000/d. Saldanha Bay-Qingdao route followed Tubarao-Qingdao path going down as well and reaching on Friday $7.75/mt level. In the Atlantic basin the market was pushing a bit more: rates on Fronthaul routes gained $1,000/d and rates on Bolivar-Rotterdam route were $0.50/mt higher for most of the week and then were weaker again on Friday, closing at $5.90/mt. Little activity reported on period.

Panamax (Atlantic and Pacific)

The beginning of the week was slow in the Panamax segment with little activity due to the crisis. Rates from the ECSAm seemed to be further weakening. As a consequence of more severe quarantine implementations, the Pacific basin appeared to be more standoff compared to previous week: owners received lower bids but, similarly to the Atlantic basin, the market was tough due to the lack of action. Both on the TA and on the Pacific RV routes dropped the number of fixtures due to the weak demand. Most trade was predominantly from Brazil: a 82,000 dwt unit with dely Brazil was fixed at $13,000/d + $300,000 bb and another 80,000 dwt was fixed for a trip to Med at $9,750/d. In addition, the declining market withheld a further blow on a number of reports as the Timbues district ceased all port activities until 3rd April due to the Covid-19 outbreak. Little activity reported also from Asia: a 81,000 dwt with dely N China was fixed at $6,500/d for a trip to Japan with minerals, whilst a 82,000 dwt was fixed at $4,250/d for a coal trip via Indonesia with redely S China. Weaker bunker prices further encouraged owners to look at deals with longer duration.

Handy (Far East/Pacific)

After quite a long positive trend, the market in F East remained more or less stable compared to previous week: on Supramax segment rates even decreased a bit, around $200/300/d less on all routes. Not many fixtures were reported to China: a 57,000 dwt with dely Hong Kong was fixed at $5,000/d for a trip via Indonesia to China. A 56,000 dwt unit with dely Indonesia was reported to be fixed at $9,000/d for a trip to Thailand and a similar unit with dely Spore took $1,000/d less for the same trip. A 55,000 dwt dely Philippines was done at $7,500/d for a trip via Indonesia to Philippines. Some fixtures were reported to West direction: a 56,000 dwt dely S China was rumoured to be fixed at $6,250/d for a trip to Bangladesh with clinker, a similar size unit with dely Indonesia was done around $7,000/d for a trip to Pakistan/Tuticorin range and a 55,000 dwt with dely Japan took $3,350/d for a trip to MEG with slags.

Handy (North Europe/Mediterranean)

On the Handies not a lot of fixtures were reported, but there were rumours about charterers ready to pay $20,000/d for a fancy 37,000 dwt unit basis dely dop Cont for trips to SE Asia. On the repositioning business, owners of nice 37,000 dwt units asked for $12,000/d basis dely dop Cont with Brazil destination. A fancy 34,000 dwt unit was reported fixed around $10,000/d basis dely Cont for trips to N Brazil with fertilizers. Also on the Supramax not a lot of fixtures were reported, but a nice 55,000 dwt Japan built was fixed around $17,500/d basis dely dop N Europe for trips to E Med with scrap cargo. In BSea the market seemed edging upwards: the tonnage tightened thanks to a bit more demand and Coronavirus quarantines that took away tonnage from the market. In our opinion, it seemed inconceivable that the disruption which is being imposed on us all, and the major economies in the Atlantic basin, will have anything but a strong bearish tone to the forward going market. On the spot market, Supramax units were fixed in the $12,000/d with dely Med for clinker cargoes to W Af, but rates on MEG-F East were seeing slightly lower numbers - guess that owners East of Suez saw fewer horrors. Was rumoured that Norden fixed a 35,000 dwt unit at or close to $15,000/d with dely Canakkale for a trip to Italy: this value probably reflected more the unattractiveness of the destination rather than the market, but the headline rate was striking.

Handy (USA/N.Atlantic/Lakes/S.America)

Another positive week in USG with larger units stable and increasing rates for Handies. Supramax units were fixed in the $15,000s/d for TA RV while Ultramax had a premium of few thousand dollars. On Fronthaul, rates were ranging between $20,000/d and up to mid $20,000/d depending on size and whether petcoke or grains. Rates kept increasing in the Handysize segment on the back of strong demand: 32/35,000 dwt units were fixed in the $11/12,000/d for TA RV, while larger 36/39,000 dwt units were fixed in the $13,000/d. The market in ECSAm started showing some negative signs: even if the difference was minimal in term of rates, this showed a different trend. Handysize units were fixed at $11,250/d for trips to Cont/Med, a touch less from $11,500/d. Also trips to F East remained pretty stable fixing around $17,000/d. Brazilian coastal trips were rumoured around $9,500/d. A bearish trend was reported in the Supramax and Ultramax segments: Supramax units were fixed at $15,000/d for trips to Cont/Med and Ultramax units were rumoured at some $1,000/d more. For trips to F East Tess58 were paying $13,250/d + 325,000 bb while Ultramax units were around $14,000/d + 400,000 bb.

Handy (Indian Ocean/South Africa)

The market within the MEG-Indian Ocean started dropping: not many fixtures came to light though the rates discussed were around $9/10,000/d basis Fujairah and nearby delivery. 56/57,000 dwt units were rumoured for short period around $10,000/d - low $10,000/d basis MEG dely. From ECI, Supramax units were fixed early in the week at $11,000/d, about $1,000/d less compared to previous week; thereafter rates started dropping further. Ports enforcing quarantine brought down the activity: an Ultramax from S Afr to Pacific basin was fixed at mid $12,000/d + low/mid 200,000 bb with coal cargo and another one was rumoured to be on subs with coal to Pakistan at low $11,000/d + mid 100,000 bb basis dely aps Richards Bay.

Banchero Costa and Co Spa


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