The Capesize market did get off to a positive start this week as rates were building strongly off improved sentiment. But as events in Europe took hold, the market abruptly changed course. The Capesize 5TC reached a high of $18,181 Wednesday before shedding -4155 by weeks end to close at $14,026. Increased fuel prices are eating into voyage rate earnings while routes like the West Australia to China C5 closed the last day of the week down -1.505 to $8.80. On the ballaster Brazil to China C3 route, rates were also seen to soften to $21.695 by close of week. The Transpacific C10, where the bulk of Capesize tonnage resides currently, came under heavy pressure settling down -6088 to $11,154. This is contrast to the Transatlantic C8 which saw only a slight easing down -1125 to $16,325. The Capesize market - along with other shipping sectors - now find themselves in the unenviable situation of being cut off from several trade routes due to war risk as vessels are now being halted, turned around and send sailing in the opposite direction.
The Panamax market began the week on a firm footing in both basins. The Atlantic saw a thinning tonnage list pitted against both a strong mineral demand in the North, alongside healthy grain demand ex NC South America and EC South America. This culminated in stronger numbers fixed. An 84,000-dwt delivery Italy achieving $21,000 for a transatlantic round trip via NC South America is an indicative mark at that time. These fundamentals remained largely unchanged, until events unfolded in Ukraine on Thursday and put a freeze on this momentum in the Atlantic. As bids were withdrawn/FFA values eroded as the market took stock of potential consequences. Asia began slowly, but a stable cargo flow ex NoPac/Australia and Indonesia for the most part continued to support rates. An 81,000-dwt delivery North China fixing at $25,250 for a NoPac round trip. There was a steady appetite for period all week, an 85,000-dwt delivery Korea agreed to $28,750 for a one-year period.
Supramax / Ultramax
A story of two halves over the week. Whilst from the Asian arena positive movement was seen in most areas, the Atlantic was dominated by the situation unfolding in the Black Sea region. Period activity was seen, a 63,000-dwt open West Africa fixing a short to medium period with redelivery Atlantic at around $28,000. The Atlantic was very fluid. A 63,000-dwt fixing a scrap run from the Continent to Turkey at $17,000, whilst another 63,000-dwt fixed a trip from Central Mediterranean to the Caribbean at $22,000. From Asia better levels were seen. A 53,000-dwt open Singapore fixing via Indonesia redelivery China at $35,000. A 59,000-dwt open Kalimantan area fixing a trip via Indonesia redelivery West Coast India at $35,000. Stronger levels from the north as well, a 63,000-dwt open Busan fixing a trip to West Africa at $32,000 for first 70 days and thereafter $35,000. There was limited activity from the Indian Ocean, a 62,000-dwt open Calabar fixing a trip via South Africa redelivery China at $34,000.
With the developing situation in the Ukraine, brokers spoke of some uncertainty as to the effects at present. As an ongoing issue it would need to be monitored closely. It was noted by brokers that some Owners were now reluctant to call these regions and conwartime clauses were coming into effect. The US Gulf region continues to firm with a 38,000-dwt fixing from Houston to Italy at $21,000. East Coast South America is a two-tier market with prompt tonnage softer with a 38,000-dwt fixing and failing a trip from Recalada to the North Continent in the mid $20,000s. However, a 38,000-dwt open in March was seen fixing Brazil to the Continent at $29,000. Asia remains firm with period activity high. A 34,000-dwt fixing from Surabaya for 90 to 120 days with worldwide redelivery at $34,000 and a 28,000-dwt open in the Arabian Gulf fixing for four to six months at $26,000.