Ocean Freight Comments
Transportation and Export Report: Jay O’Neil, O’Neil Commodity Consulting: The Baltic Panamax Index has clawed its way back to 700, which is where it was in mid-August. So, it continues to look like the markets are mostly steaming in circles waiting for something sustainable to happen.
Not surprisingly, physical freight markets have been slower to follow the full excitement of the index buyers. Global freight markets, in all sectors, have obviously been living in a state of financial hardship and emotional depression for the last couple of years and are desperately watching and hoping for any sign of a turnaround. Every market bounce produces a sense of optimism and renewed interest in new investments, which in turn becomes counterproductive. Ocean freight investors will have to learn to apply patience and enjoy small improvements before jumping in with new investments and vessel orders to obtain what they truly desire and need.
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 the Philippines.
