Ocean Freight Comments
Transportation and Export Report: Jay O’Neil, O’Neil Commodity Consulting: The Capesize Dry-Bulk markets took a breather and closed slightly lower this week after the paper traders noticed that the physical markets were not following their lead. The Dry-Bulk Panamax market, however, believed that demand is looking strong and both paper and physical markets decided to move on upward for the week. We have witnessed a substantial Panamax Dry-Bulk market rally over the last 13 months as rates from the U.S. Gulf to Asia have climbed from a low of $22.50 up to near $40.00/MT. The last time we saw $40.00/MT from the U.S. Gulf to Japan was back in December 2014.
It should be noted that the forward curve for all Dry-Bulk market sectors remains inverted and therefore indicates that traders are not as optimistic about rates remaining at these levels out into the third and fourth quarters of 2017.
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 South Korea.
