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AMIS Market Monitor

last release: March 2019

Ocean freights

Despite a recent recovery in the grains and oilseeds carrying sectors, average Baltic Dry Index (BDI) values posted a steep 41 percent monthly decline in February, dropping to their lowest since June 2016. The Index was down by almost one-half y/y, with sharp losses across all underlying segments. Capesize earnings averaged 60 percent lower compared to January as the dam collapse in Brazil sparked worries about a loss in iron ore output and trade. Limited tonnage availability in the north Atlantic and strength in bunker prices supported, but news of fresh coal imports restrictions by China, including from Australia, compounded pressure recently. 

Panamax rates retreated by 40 percent on average. Values initially dropped steeply amid dwindling spot and period interest, but advanced thereafter on firmer enquiries in the Pacific, led by good volumes out of north Pacific ports, coupled with buoyant mineral trading in the Indian Ocean. Among reported grains/oilseeds fixtures, a 60 000 tonne cargo from Brazil (Paranagua) to China was booked at USD 27.50 per tonne, for March shipment, while a 66 000 tonne delivery from the US Gulf (Mississippi River) to the same destination was agreed at USD 36.20 per tonne.

Average Supramax and Handysize earnings eased by 27 percent and 32 percent m/m, respectively. The Lunar New Year holidays in Asia and growing vessel lists initially pressured rates on all major routes, but a subsequent upturn came from stronger momentum in the Atlantic, notably for deliveries to Europe and Africa, as well as steady improvements in the Asian market.