Ocean Freight Comments
Transportation and Export Report: Jay O’Neil, O’Neil Commodity Consulting: Are global dry-bulk freight markets higher or lower this week? It depends on who you ask and what sector you are examining. Some daily hire rates are up slightly while others are soft and a bit lower. The Capesize market has shown more support than has the Panamax or Supramax sectors. Ocean freight markets are still struggling to find sustained cargo demand and 2018 is just not turning out to be the recovery year that was anticipated.
Still, Baltic Index traders constantly look for reasons to buoy the market. It is accurate to say that shipping operating costs are increasing and the need for higher rates is real. However, it is going to take some improved global economics and a reduction in uncertainties that surround the tariff situation to make things change for the better. For now, we simply continue to steam in small circles. In the next 30-45 days we should see the seasonal shift in cargo demand from East Coast South America to the U.S. Gulf. Dry-bulk new build vessel orders have come almost to a stop and ship construction yards are really feeling the economic pain.
The charts below represent 2018 YTD totals versus 2017 annual totals for container shipments to Hong Kong.
