Ocean Freight Comments
Transportation and Export Report: Jay O’Neil, O’Neil Commodity Consulting:
By Monday the Lunar New Year celebrating should be over and Asian industries should be returning to work.
World ocean freight markets are anxious to see what new business develops and are certainly hoping that the uptick in North and South American grain and oilseed exports will provide a needed boost in cargo demand and prices. Current Baltic indices are back to where they were in mid-November, but they are considerably better relative to this time last year.
U.S. grain and oilseed exports continue at a very good pace and are soaking up much of our export capacity for the next three months. According to USD data, during the week ending January 30, 37 ocean-going grain vessels were loaded in the U.S. Gulf, which is 5 percent less than the same period last year. Ninety-seven vessels are expected to be loaded within the next 10 days, which is 106 percent more than the same period last year. Interior logistics remain messy and expensive. Buying grains, oilseeds and freight is not the problem – getting the product to the port and loaded in a timely fashion is. Logistic should be as much a concern as price in today’s markets.
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 2011 and January-December 2012 annual totals versus January 2013 year-to-date container shipments for Japan.
