Ocean Freight Comments
Transportation and Export Report: Jay O’Neil, O’Neil Commodity Consulting: These are truly crazy markets. If some tells you they understand this market, I fear they are being less than honest. FFA paper traders have been able to push things higher, so they do so. Fundamental factors have become less important than emotions as the market experienced another big jump in paper and physical rates this week. But markets are now looking quite toppy (famous last words). River drafts in Argentina are dropping and severely limiting cargo loaded upriver.
As dramatic as dry-bulk markets have been, container markets continue to outshine and amaze. The tightness in container space and difficult logistics has caused some to reach out to the 30-60-day charter market for smaller size container ships of 3,000-6,000 TEU and pay whatever it takes to obtain space for immediate needs. American Shipper reports that “a freight forwarder is reportedly paying $135,000 per day for a short-term charter of the S Santiago, a 15-year-old container ship with a capacity of 5,060 twenty-foot equivalent units (TEUs).” And some of these short-term charters are for routes coming to the States and Europe.
