Ocean Freight Comments
Transportation and Export Report: Jay O’Neil, O’Neil Commodity Consulting: It was a fairly quiet week in global ocean freight markets. The rally of the past week seems to have fizzled out and the market is re-grouping at slightly lower rates.
I believe the biggest issue facing the market now is whether or not vessel owners will heed the advice given at the annual Posidonia conference and not invest in more new builds. There is always the itch to order new vessels and expand once the market feels it has bottomed out and may be on the road to improved conditions. But to build more ships would be a killer for this struggling market and industry.
We are just ten days away from the opening of the new expanded Panama Canal. Please keep in mind that the Old locks will still be in operation and many ships will continue to transit through them for reasons of size and toll fees.
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 Indonesia.
