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Baltic Exchange: Maritime Market Highlights 01 – 06 January

techsm5

The Baltic Exchange has released its reports for the first week of 2023, to provide insight into the performance of the tanker and bulk market.

Capesize

Jhe decline in the first week of the year did not appear to surprise the market due to lackluster activity and seasonal headwinds since the holiday season. The average Capesize 5 timecharter (5TC) route fare saw its biggest drop on Tuesday, losing almost 30% compared to the last day of publication 10 days ago. Later in the week the market continued to decline but at a slower pace and eventually lifted $70 on Friday to close the week at $12,543. Compared to the same time last year, 5TC is around $7,000 or 35% lower in value. While the Atlantic remained calm, trade from Western Australia to Qingdao was priced below the $7 average throughout the week. The demand and freight survey next week will determine the direction the Capesize takes ahead of the fast approaching Lunar New Year.

panamax

After the Christmas holidays, the Panamax market started calmly across the board, followed by price pressure from the get-go. The downward pressure came from a lack of demand in both pools all week, forcing owners to concede cheaper levels. The Atlantic saw some improvement in activity in South America, but with excess tonnage count rates drifting throughout the week. After a weak end to 2022, the higher number of ballasts from Southeast Asia only aggravated the weaker market. And, with Asia massively unsupported, the immediate outlook looked very bearish – $8,000 was agreed for delivery of 82,000 dwt to China for a NoPac round trip. Consequently, Aps and Ballast bonus offers were the norm between South America and the Far East, with varying rates depending on dates. However, $16,500 + $650.00 has been agreed a few times for index/date types. Activity in the period included a scrubber fitted with a delivery of 81,000 dwt to China set for five to eight months at $16,250.

Ultramax/Supramax

The first week back for many after the holidays did little to cheer owners as the Pacific and Atlantic regions suffered from a limited recent survey and an abundance of fast tonnage. The general feeling among many players that this trend may continue until after the Lunar New Year, but only time will tell. In the Atlantic, activity was seen from the US Gulf, with 57,000 dwt setting a Mediterranean voyage at $18,000. Elsewhere, a 56,000 dwt was pegged from the Mediterranean to West Africa at $10,000. Little action was seen in South America and rates remained under pressure. Asia also saw downward pressure and again pressure centered on the amount of readily available open tonnage. A fixing of 61,000 dwt for a voyage from Kwangyang to the Persian Gulf at $8,000. Meanwhile, an open CJK of 53,000 dwt was heard set for an Indonesian round trip at $3,000. It remains to be seen how long it will take to absorb the excess tonnage.

Convenient size

Sentiment remained negative, despite a comeback for many after the holiday season, with further losses in both basins. The east coast of South America saw levels fall due to a lack of investigation with Fazendinha fixing 32,000 dwt to the eastern Mediterranean at $11,000. Meanwhile, a 38,000 dwt Santos pegged Morocco at $15,250. In the Mediterranean, a fixed base delivery of 36,000 dwt Canakkale to the Caribbean with an expected cargo of steels at $7,500 for the first 40 days and $10,000 for the remainder. An unnamed practical-sized vessel was linked to securing an $8,000 cargo of sulfur from the Baltic in Casablanca, but further details had yet to emerge. In Asia, activity was also limited. Attachment of 30,000 dwt from South East Asia to China at $5,100 and large handrail reportedly placed on subjects from South Korea via Prince Rupert for round trip with wood pellets around $7,000.

Own

The Middle East Gulf has been strained this week with out-of-market fixings and 2023 flat rate fixing levels yet to be seen on LRs. On MRs, WS355 was reported on subjects for a TC17 run at the end of the week on 2022 flat rates – converting to around WS275 on 2023 flats.

West of Suez, LRs have been particularly quiet this week with hardly any matches reported on the open market. TC16 lost another 7.87 points to WS253.63 and TC15 lost $41,000 in the middle of $4,900,000.

UK mainland RMs had just enough activity to keep rates stable. TC2 held one or two WS points below WS200 and TC19 hovered around the WS215-217.5 region.

The Handymax market in the Mediterranean has been in freefall this week, with very few surveys sending the TC6 index down 57.82 points to WS234.06. On the UK mainland, TC23 remains stable at WS250 at the time of writing.

US Gulf MR markets suffered the most this week. A widely reported £550,000 USG/Caribbean match drove the TC21 index to this level. TC14 also lost 12.5 WS points to WS112.33 and TC18 fell to WS186.67 (-18.66).

The MR Atlantic TCE triangulation basket lost $962 from $29,257 to $28,295.

VLCC

The VLCC market trended lower this week and 270,000 tonnes from the Middle East Gulf to China fell three points to WS53.27, translating to a round trip TCE of $31,800 based on the Baltic Exchange vessel description. The 280,000 mt route between the Middle East Gulf and the US Gulf (via course to course routing) is valued at WS39.67, down two points this week. In the Atlantic region, the rate for 260,000 tonnes West Africa/China is three points lower at WS54.59 (a round trip TCE of around $33,700 per day) and 270,000 tonnes Gulf /China in the United States fell from $315,625 to around $8.43 million. ($35,400 per day round trip TCE).

Suezmax

The Suezmax market fell in all regions this week. Rates for 135,000 mt CPC/Augusta fell 15 points to WS173.44 (a round trip TCE of $94,300 per day), even though Suezmaxes are used on a partial cargo basis for Aframax cargoes. For the 130,000 tonne Nigeria/Rotterdam trip, fares also fell 15 points to WS93.5 (a daily return TCE of around $35,000). The 140,000 tonne Basra/Lavera market eased around 5.5 points to WS68.5.

Aframax

In the North Sea market, fares for the 80,000mt Hound Point/Wilhelmshaven route have held steady this week around the WS170 mark (a daily round trip TCE of $68,000). In the Mediterranean markets, the rate for 80,000 mt Ceyhan/Lavera has risen 13 points since the New Year to reach WS173 (a daily round trip TCE of $57,100). The U.S. Aframax market fell again after the holiday season and the rate for 70,000 tons on the East Coast of Mexico / Gulf of the United States is 54 points lower than at the start of the week at WS143 (about $32,200 per day TCE round trip), while rates for the 70,000 mt Covenas/US Gulf trip plummeted 46 points to just below WS132 (a daily round trip TCE of $25,900). For the longer haul 70,000mt US Gulf/Rotterdam trip, fares have fallen almost 20 points this year to WS176 (showing a round trip TCE of almost $45,300 per day).

techsm5

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