Market Perspectives – May 27, 2021

Ocean Freight Comments

Transportation and Export Report: Jay O’Neil, O’Neil Commodity Consulting: Dry-bulk markets are a bit softer at week’s end with the Capesize markets again leading the way. Paper traders have tried to keep rates higher, but the physical market has not supported these efforts. Capesize vessel owners are disappointed the current market is allowing just $30,000 per day as they still have the early May high of $40,000/day in their heads. Panamax owners are now getting $23,500/day verses the $27,000/day just a few weeks ago. The Supramax sector has been holding up well and is getting $27,100/day, as good or slightly better than Panamax vessels.

From a buyer’s perspective, the container sector is the only one not improving as rates remain high and service poor. Basic inbound rates on 40-foot containers from Shanghai to the U.S. West Coast remain high at $6,135/TEU versus $1,400 one year ago. Yesterday, I heard that one buyer paid $15,000/TEU for special expedited service. This certainly emphasized why shipping lines are anxious to return containers empty rather than wait for backhaul loads.