Ocean Freight Comments
Transportation and Export Report: Jay O’Neil, O’Neil Commodity Consulting: It was not a very news-worthy week in global ocean freight markets. For the most part, things were fairly quiet. The Capesize fleet benefited from a decline in new buildings and deliveries and growing volumes of iron ore business out of western Australia. Most of the grain demand continues to come from South America and the Black Sea region, but this has not been sufficient enough to rally prices.
Container rates for grains and oilseeds look like they have dropped just below $1,000 per 40 ft. TEU for 45-60 day shipment. This would equate to a dollar rate of about $38.00/MT from the Chicago area to China. The decline in incoming loaded containers from China due to the slow U.S. economy has created a poor, and hungry economic environment for shipping lines on both east and west-bound traffic. It’s still a buyers’ market out there. But even at current rates levels Dry-Bulk remains cheaper than container freight for buyers of quantity.
Below is a recent history of freight values for Capesize vessels of iron ore from Western Australia to South China:
The charts below represent January-December 2014 annual totals versus year-to-date 2015 container shipments to Taiwan.
