Ocean Freight Comments
Transportation and Export Report: Jay O’Neil, O’Neil Commodity Consulting: The Baltic Indices continued their downward slide this week as freight demand remained elusive.
We have reached the point where vessel owners are thinking about holding their ships back from the market to wait for better times. You will note that that the Baltic P3A index in the Gulf-Atlantic was trading at 23823 on January 10 and now, just four months later, it is sitting at 13177. That is a drop of 10,646 points or 55 percent.
This is not what vessel owners or their banks were expecting in the 2014 season. Thought the market is definitely soft and defensive, I am leaving most of the rates unchanged , or little changed, due to the thinness of trading activity and the general reluctance of vessel owners to let go at current levels. We will have to see which side wins the price battle next week. The Capesize market remains the weakest.
Below is a recent history of freight values for Capesize vessels of iron ore from Western Australia to China:
The charts below represent January-December 2013 annual totals versus January 2014 year-to-date container shipments for Indonesia.
