The Baltic Dry Index, a measure of shipping costs for commodities, posted a third consecutive drop on Friday on weakening demand for iron ore to make steel.
Rates to hire capesize vessels that haul coal and iron ore dropped 17% in a 3rd straight weekly decline.
The index fell 79 points, or 3.6 per cent, to 2,122 points, according to the Baltic Exchange. That's a 4.6 per cent decline for the week. Rates to hire capesize vessels that typically haul coal and iron ore dropped 17 per cent in a third straight weekly decline to US$23,534 a day.
'Ex-China, there are no signs of life,' Chris Tomlinson, a London-based analyst at Thurlestone Shipping Ltd, said on Friday. 'Even there they have high stocks of ore and falling steel prices, so their buying has slowed.'
Steel demand from carmakers and builders has slumped as companies cut production to grapple with a slowing world economy. Iron-ore stockpiles in China, the world's biggest steelmaker, have risen 1.2 per cent this year as domestic prices of hot-rolled sheet, a benchmark product, have fallen 12 per cent.
Rates for panamax ships, the biggest to fit through the locks on the Panama Canal, shed 3.2 per cent last week to US$17,293 a day. That indicates demand to haul South American grains may have eased after pushing rents for the vessels 45 per cent higher the previous week.
Capesize forward freight agreements, derivatives used by traders to bet on future shipping rates, rose 2.4 per cent to US$19,000 a day for the second quarter in Oslo. Panamax futures advanced 1.6 per cent to US$13,250 for the same period. The data are from broker Imarex NOS ASA.
However, rates for transporting crude oil from the Caribbean on Aframax tankers rose 12 per cent last week as demand outweighed the number of ships available for voyages.
'Aframax rates continued to rally in the Caribbean,' EA Gibson Shipbrokers, based in London, said in a note. 'In the short terms, rates are likely to be repeated but owners will struggle to maintain this level during next week.'
Aframaxes on Friday were hired for an average rate of Worldscale 140, according to New York-based Poten & Partners, London-based Galbraith's and Houston-based Lone Star, RS Platou, a decline of 1.8 per cent from Thursday. Worldscale 140 is about US$36,978 a day after expenses, such as fuel and port fees.
Rates have more than doubled in March after ships moved out of the region at the end of February in search of higher rates in Europe, driving down supply.
'The thinning of tonnage allowed the firming of rates to continue this week,' Galbraith's said in a note. 'Inquiry levels will need to be maintained to keep these rates from softening.'
More than 40 per cent of US crude imports come from nearby countries, including Canada, Mexico and Venezuela, according to EA Gibson Shipbrokers. The US consumes about one-quarter of the world's crude.
General Maritime Corp, the second-largest US- based tanker owner, estimated its 2009 daily operating expenses for an Aframax at US$8,150.
Worldscale points are a percentage of a nominal rate, or flat rate, for tanker shipments on various routes. Flat rates, quoted in US dollars a ton, are revised annually by the Worldscale Association in London to reflect changing costs.
The Caribbean is the world's third-largest Aframax-tanker market, after the Mediterranean and South-east Asia. An Aframax is the most common tanker used to move oil in the region. It can carry 600,000 barrels of oil.
Rates to hire capesize vessels that haul coal and iron ore dropped 17% in a 3rd straight weekly decline.
The index fell 79 points, or 3.6 per cent, to 2,122 points, according to the Baltic Exchange. That's a 4.6 per cent decline for the week. Rates to hire capesize vessels that typically haul coal and iron ore dropped 17 per cent in a third straight weekly decline to US$23,534 a day.
'Ex-China, there are no signs of life,' Chris Tomlinson, a London-based analyst at Thurlestone Shipping Ltd, said on Friday. 'Even there they have high stocks of ore and falling steel prices, so their buying has slowed.'
Steel demand from carmakers and builders has slumped as companies cut production to grapple with a slowing world economy. Iron-ore stockpiles in China, the world's biggest steelmaker, have risen 1.2 per cent this year as domestic prices of hot-rolled sheet, a benchmark product, have fallen 12 per cent.
Rates for panamax ships, the biggest to fit through the locks on the Panama Canal, shed 3.2 per cent last week to US$17,293 a day. That indicates demand to haul South American grains may have eased after pushing rents for the vessels 45 per cent higher the previous week.
Capesize forward freight agreements, derivatives used by traders to bet on future shipping rates, rose 2.4 per cent to US$19,000 a day for the second quarter in Oslo. Panamax futures advanced 1.6 per cent to US$13,250 for the same period. The data are from broker Imarex NOS ASA.
However, rates for transporting crude oil from the Caribbean on Aframax tankers rose 12 per cent last week as demand outweighed the number of ships available for voyages.
'Aframax rates continued to rally in the Caribbean,' EA Gibson Shipbrokers, based in London, said in a note. 'In the short terms, rates are likely to be repeated but owners will struggle to maintain this level during next week.'
Aframaxes on Friday were hired for an average rate of Worldscale 140, according to New York-based Poten & Partners, London-based Galbraith's and Houston-based Lone Star, RS Platou, a decline of 1.8 per cent from Thursday. Worldscale 140 is about US$36,978 a day after expenses, such as fuel and port fees.
Rates have more than doubled in March after ships moved out of the region at the end of February in search of higher rates in Europe, driving down supply.
'The thinning of tonnage allowed the firming of rates to continue this week,' Galbraith's said in a note. 'Inquiry levels will need to be maintained to keep these rates from softening.'
More than 40 per cent of US crude imports come from nearby countries, including Canada, Mexico and Venezuela, according to EA Gibson Shipbrokers. The US consumes about one-quarter of the world's crude.
General Maritime Corp, the second-largest US- based tanker owner, estimated its 2009 daily operating expenses for an Aframax at US$8,150.
Worldscale points are a percentage of a nominal rate, or flat rate, for tanker shipments on various routes. Flat rates, quoted in US dollars a ton, are revised annually by the Worldscale Association in London to reflect changing costs.
The Caribbean is the world's third-largest Aframax-tanker market, after the Mediterranean and South-east Asia. An Aframax is the most common tanker used to move oil in the region. It can carry 600,000 barrels of oil.