Ocean Freight Comments
Transportation and Export Report: Jay O’Neil, O’Neil Commodity Consulting: It is a bit difficult to pinpoint dry-bulk ocean freight rates today. Technically the Baltic Indices still look bullish and seem to want to move higher, but the physical market appears to be losing some steam and is showing sign of fatigue. It has been a good run-up over the past two months and it is always hard for any market to keep moving in just one direction for very long. Though China iron ore and coal imports should remain steady and supply market support, and the North American fall harvest is right in front of us, I do see vessel owners starting to pull back on vessel scrapping and even sneak in some new build vessel orders.
This is not a strategy that will support long-term profitability for vessel owners and operators. They need to avoid killing the golden goose. But, for this week markets seem to be mostly steady and looking for new input. Be advised that the port of Brunswick, Georgia in the United States was damaged in the last hurricane and the timeline for repairs to the facility – and subsequent resumption of grain loading – is unknown and questionable.
Below is a recent history of freight values for Capesize vessels of iron ore from Western Australia to China:
The charts below represent YTD 2017 versus 2016 annual totals for container shipments to Thailand.
