Since the Spring Festival in Asia was almost celebrated in the Year of the Tiger last week, the dry bulk shipping market was relatively calm. At the end of the holiday, there is a gradual increase in trading in the market.
The Poland Exchange's cape 5TC rose 15.5% last week to $10,302 per day on Friday. The Cape ship market is usually regarded as a market with relatively large daily fluctuations, so it can be said to be a "sideways trend".
In its weekly dry bulk market report, the Company wrote: "The Spring Festival has made the dry bulk shipping market even more sluggish. After the holidays, with all traders going to work, many people are likely to look to the wind and push the cape market out of its current slump. ”
On Friday, an anonymous tenant leased nissin Kaiun's 181,200 dwt Ehime Queen (built in 2016) at a freight rate of $24 per tonne, transporting 170,000 tonnes of iron ore from southeastern Brazil to Qingdao, China, from March 20 to 30.
Tocque last Thursday chartered Moundreas Shipping's 171,000 DWT Charm vessel (built in 2003) for $19.75 per day, also to transport 170,000 tonnes of iron ore from southeastern Brazil to Qingdao, China, but with an earlier loading period, from February 20 to 28.
According to the Polish Stock Exchange, the freight rates of smaller vessels have not changed much, with the Panamax 5TC down 2.4% last week to $16,156 per day on Friday. The Ultra Handy 10TC fell 0.2% to $17,531 per day on Friday, while the Handy 7TC rose 2.1% to $17,819 per day on Friday.
January was a "forgotten month" for Panamax vessels, with 5T fares down 40 percent since Jan. 6, according to the BLAN. Although sentiment improved overall on Thursday and Friday, there was less demand in the Atlantic market, leading to a further decline in freight rates. ”
With the end of the Spring Festival holiday and the increase in market activities, the market sentiment of ultra-handy boats and handy boats has gradually become positive.
Some market participants analyzed: "At the end of the week, there was the first glimmer of recovery in some areas, and the market may improve." ”
On Tuesday, King Ofeland Oldendorff chartered OceanFleet Shipping's 35,529 dwt Global Harmony (built in 2010) from Edmir across the Black Sea to Morocco for $14,000 a day.
Shipbroking allied Shipbroking noted in his latest weekly report that iron ore prices rose sharply to their highest level in five months as a result of the large amount of cargo hoarded before the Spring Festival and the increase in trader and producer activity years later. But given that China's financial markets and most businesses were closed during the Spring Festival, the positive momentum could be short-lived.
Source: Allied Shipbroking
George Lazaridis, director of Allied's Research & Valuations division, said, "Meanwhile, steel production will remain restricted (at least in the region) over the next three weeks as the government needs to control air pollution due to the Beijing Winter Olympics. All of this will make the seasonal decline in the market last longer than in the past, which may also be a major blow to market sentiment and the recovery time will be longer. ”
But Lazaridis also said: "On the positive side, the iron ore market seems to have plenty of speculative opportunities in the future." Before iron ore prices experience a similar rebound from March 2021 to July 2021, while several companies are ready to find ships and cargoes now, it will take some time to reach a balance between supply and demand. And as China's quest to diversify its sources of iron ore supply will give a strong boost to demand for tonne-miles, the dry bulk carrier market could receive a further boost."
He added: "The rally in these days is partly attributable to the monetary policy easing of the Chinese Bank. China's central government wants to address slowing economic growth, and if this policy continues for much of March or even the second and third quarters of 2022, China's import demand is likely to increase further. Summer is the peak of construction projects, so traders' current expectations of a sharp rise in steel demand should support another seasonal rebound in freight rates in the third quarter. All in all, the outlook for the Cape boat market is more optimistic. ”
Source: Sohang Network