Ocean Freight Comments
Transportation and Export Report: Jay O’Neil, O’Neil Commodity Consulting: Given the Golden Week holiday in China (which runs from 1-7 October) it was a fairly quiet week dry-bulk freight markets. Rates rallied slightly early in the week but settled lower at week’s end. Chinese demand and the global economic outlook remain the big issues.
The biggest news in U.S. freight markets is the low water situation on the Mississippi River and the restrictions this is causing to southbound barge freight movements. This will push more grain movement to rail and more exports to the PNW for October, and possibly longer if the dry weather persists.
The U.S. railroad industry’s tentative labor contract has been voted on by union members, but full results will not be known until November. Rail service to all ports will be critical during the low water conditions on the Mississippi River system and rail cars will be trading at big premiums. It is going to be a very challenging U.S. harvest season.
