Market Perspectives – September 22, 2022

Ocean Freight Comments

Transportation and Export Report: Jay O’Neil, O’Neil Commodity Consulting: It has been a volatile week in dry bulk markets  but, at the week’s end, freight markets are described as “stabilizing”. The translation of this definition is that markets were unable to continue their upward recovery and fell back but have been able to limit losses. It remains a complicated game with China and the Black Sea holding most of the important cards. The market volatility is not surprising after the 93 percent drop in the Baltic Capesize index between May and August. Some degree of recovery is to be expected but last week’s big jump was a bit too much too soon.

The ILWU-West Coast Port labor contract negotiations are ongoing but seem to have hit a snag on the issue of port automation. Shippers and receivers must keep a close eye on this.

A tentative contract has been negotiated between railroads and labor unions and has gone to the rank-and-file union membership for final approval. The vote will be held Thursday, 22 September. Some give the new contract  60 percent odds of being passed by the unions and it may be next week before the outcome is known.