Some nervousness lower down the scale

Some nervousness lower down the scale
Published: 30 August 2006

The lower financial results of some owners have progressively disclosed in their half-year reports and the correction recorded recently on the freight market have failed to dampen most dry bulk market players faith in future market trends.

Owners results have been affected by higher bunker costs and lower rates on the spot market particularly during the first quarter, but so far no one see this situation to recur in the second half.

The Panamax market has had a similar evolution as the Capesize market, that is falling at the beginning and strengthening at the end of last week. It lost over the whole of last week about US$500 on the 4t/c index routes from about US$28,500 to about US$28,000 level.

A few Capesize stems in the Atlantic have been split into Panamax sizes, which might have a strengthening effect in the Atlantic but there seems to be sufficient tonnage open. So, maybe not many changes expected during this week.

The Handy/Supramax market is still affected with extreme nervousness. If the Atlantic seems oversupplied, particularly in West Africa/ ECSA, the Far East looks more positive. Supramax obtain in the low 30’s for TCT US Gulf/Far East when Handymax get low/mid 20’s for trips Med/Cont to Far East. In the East round voyages pay in the high 20’s/low 30’s depending size and delivery. It looks that the monsoon is still affecting the market.

Source: Barry Rogliano Salles, Shipbrokers, Paris