ISM Freight Market Weekly Digest // week 50
International Seaborne Market
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The shortage of fresh cargo requests is still acute in the Black and Mediterranean Seas due to extremely dull sales of grain, steels and coal. The surplus of open Handy and Supra vessels is keeping freight rates on bottom. Panamax owners have literally no chance to find a cargo and therefore prefer ballasing towards Gibraltar. At the moment, brokers suggest $6-7k daily for a standard Handysize vessel bss dely passing Canakkale via CVB or Ukraine redel Med.
Actitivy remains limited and there is no pre-holiday excitement. The tonnage list is excessive, which allows charterers to defend their freight ideas more confidently. Over the week, freight rates have sagged by another $0.5-1.5k daily and $0.5-1.5/t in many cases. The deal for steel scrap transportation by a 35k dwt vessel bss dely ARA redel EMed has been signed below $9k daily, while some players report the level of $7.5k daily on this route.
In ECSA, Smx/Umx owners are showing more resistance to charterers, trying to talk down the market, while they still seek to cover their cargoes within December dates. In general, cargoes are scarcely available, but the tonnage list looks manageable in the region and it helps ship owners avoid rate falls. TCT rates for Ultramax fleet bss dely ECSA redel FEast are hovering at $13-14k daily + $300-400k bb, those for large Supramax vessels at $12-13k daily + $200-300k bb on average.
The Handysize market of North Atlantic is under pressure of limited cargo offer for December laycans, with just a few T/A and Intercaribs cargoes around. Rates are falling given the demand/supply imbalance in the region. TCT rates for large Handies bss dely USG redel Skaw-Passero are hovering at $12-13k daily, while levels for small Handies are voiced at very low $10s k daily.
Owners of Panamax/Kamsarmax fleet working in the Asia-Pacific region lack confidence due to limited offer of Indonesian coal as well as a slowdown in Australian coal exports. A Kamsarmax vessel is rumored to have been fixed at $9k daily bss dely Zhuhai via Indo redel N.China; a 75,000 t lot of coal has been fixed from E.Aus to Vizag at low $14s/t with 1H January laycans and 35000x/20000x l/d rates (equivalent to $8-9k daily bss dely N.China).
The pace of trade remains very low in the Black Sea, especially when it comes to grains and steels. With only 10 days left till Christmas holidays in Europe, it is already definitely clear that coaster owners have no chances to raise rates at least somehow. The gap in ideas between grain charterers and owners has even widened, especially for Ukrainian grains. Thus, traders offer mere $21/t for transportation of 6,000 t of corn from Izmail to Alexandria with 1250 sshex bends l/d rates, while owners are seeking to get at least mid-$20s/t.
Market activity keeps going down in the Azov Sea amid another decrease in demand for Russian grains and coal in Turkey. Despite worsened weather and increased delays (Kerch straits were closed till the end of the week), sea-river owners are still unable to stop the rates decline. Most charterers already target $22-22.5/t for shipment of 3,000 t of peas of corn or wheat from Rostov/Azov to Marmara, which is equivalent to mere $1.1-1.3k daily bss RV.
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The market picture is relatively favorable for small-tonnage owners working in the Baltic and North Seas, particularly compared to situation in South Europe. As before, brisker cargo traffic, increased tonnage demand before holidays and worsening weather conditions maintain some excitement in the area. As a result, ship owners do not lose hope to strengthen positions slightly. Thus, freight rates have added another €0.5-1/t in many cases.
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No pre-holiday rush seen on small-tonnage market
Amid general stagnation, some positions improvements finally occurred on the market
Overall market picture mixed, with rate shifts varying depending on a region
Not much cargo seen on the market despite approaching holidays
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