Ocean Freight Comments
Transportation and Export Report: Jay O’Neil, O’Neil Commodity Consulting: The Baltic indices turned upward this week and, for a change, sustained a small rally day-after-day this week. The 11-15 percent increase in the Baltic-Panamax index looks substantial, but one must remember that we started from a very-low level and small increases will equate to big looking percentages.
As often happens, the nearby physical markets did not get as excited as the Baltic time charter indices and therefore did not run up as much. The improved freight interest is primarily coming from the Panamax and smaller vessel sector down in the East Coast South American market. The Capesize trade tried, but failed, torally this week and ended up at the low side of the weekly rate range. I don’t see any sustainable support under these markets and therefore would expect things to roll back to previous levels in the coming weeks.
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 Hong Kong.
