Ocean Freight Comments
Transportation and Export Report: Jay O’Neil, O’Neil Commodity Consulting: Baltic Freight Traders tried to support a two-week rally in the index rates. They succeeded for the first three days of this week/week two, but things now feel toppy and the support is waning. We are seeing more freight offers develop out of the Black Sea, South America and the U.S. Gulf.
As mentioned numerous times, the physical freight markets do follow the general direction of the Baltic Indices but do not move with the indices step by step. It is interesting to note that back on May 18 the Baltic Dry-Bulk Panamax Index was at 894 and the physical markets from the Gulf to Asia and the PNW to Asia were at $37.25/MT and $19.50/MT respectively. Today that index is at 1,119 and the physical rates are at about the same rates ($37.25/MT and $19.00/MT, respectively).
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 Malaysia.
