Ocean Freight Comments
Transportation and Export Report: Jay O’Neil, O’Neil Commodity Consulting: The Chinese are back from their brief holiday but don’t seem to be in a big buying mood. Global freight markets are therefore feeling a bit toppy and rates today are somewhere between unchanged to slightly lower than last week.
The Dry-Bulk Supramax and Handymax markets continue to be the softest among the freight sectors. The bigger news is probably in the U.S./Mississippi River barge freight market where reduced demand and overcapacity have driven April-May barge freight rates down to 185-245 percent of CCR. At these low rates barge owners are contemplating parking their tow boats and barges and waiting for rates that cover their cost of operation. Domestic rail business is also suffering and rail car costs are also down substantially from past weeks and months. But we are, of course, in the U.S. spring planting season when farmers focus on their fields and not their grain marketing needs.
Below is a recent history of freight values for Capesize vessels of iron ore from Western Australia to China:
The charts below represent YTD 2017 versus 2016 annual totals for container shipments to Japan.
