Ocean Freight Comments
Transportation and Export Report: Jay O’Neil, O’Neil Commodity Consulting: As expected by some, the market rally of the past month was a bit too much, too fast, with too much owner optimism regarding its sustainability. The rally did provide vessel owners with an early Christmas present, but now the batteries are quickly wearing out. This week saw more vessel tonnage entering the market and chasing values and there was just not enough good business to pass around to all. In the Dry-Bulk Panamax sector daily hire rates dropped to $10,300/day and Q1 hire rates slumped to $6,500/day. If you are a buyer in the Supramax or Handymax market you will find that the physical market has been slower to adjust. As we move further into the holiday period there will be fewer players in their offices and markets will get even thinner.
Below is a recent history of freight values for Capesize vessels of iron ore from Western Australia to China:
The charts below represent year-to-date 2016 versus January-December 2015 annual totals for container shipments to Taiwan.
