Coal and iron ore freight rates fell from records after eight days of gains. The declines may be limited on expectation of rising dry-bulk trade and bottlenecks at ports.
Cargo costs: Capesize rates slumped to US$172,087 while panamax rates rose to US$94,977 and supramax rates are at an all-time high of US$72,729
The Baltic Dry Index, an overall measure of commodity shipping costs on different routes and ship sizes, fell 1.3 per cent to 10,886, based on data from the London-based Baltic Exchange. The decline is the most since June 14. Hiring rates for a capesize slumped 4.3 per cent to US$172,087 on average on Tuesday, the lowest since Oct 8.
China, producer of one-third of the world's steel, may boost imports of iron ore, the steelmaking ingredient, by 40 million tonnes in 2008, Luo Bingsheng, vice-chairman of the China Iron & Steel Association, said yesterday. Iron ore imports will rise from this year's estimated 370 million tonnes, he said. Demand for iron ore, the single-biggest commodity shipped by sea, helped more than double freight rates in the past year.
'In a dry bulk environment at which fleet utilisation is 97 per cent to 98 per cent, only small adjustments to demand tend to have a large impact on short-term rates,' Henrik With and Glenn Lodden, analysts at DbN Nor Markets, said in a statement yesterday. 'We view the fall in physical capesize rates as normal volatility in such a market.'
While capesize rates fell, hiring cost for a panamax, which can move 70,000 tonnes of cargo, rose for the eighth day to US$94,977 on average on Tuesday, according to the Baltic Exchange's data. The charter rate for a supramax, which can haul between 50,000 tonnes and 59,999 tonnes of goods, increased to an all-time high of US$72,729 on average on Tuesday. It has been setting a daily record since Sept 24.
China's switch to a net coal importer in January and congestion at ports also contributed to higher freight rates. At Australia's Newcastle, the world's largest export harbour for thermal coal, the number of ships waiting to load the fuel rose to 39 on Oct 29 from 37 on Oct 22, Newcastle Port Corp said on its website.
The coal carriers waited an average of 16.7 days to load, longer than last week's 15.55 days. The port's coal shipments fell to 1.66 million tonnes for the week ended Oct 29 from 1.96 million tonnes a week earlier, Newcastle Port said.
The declaration by Anglo American plc, the world's second-biggest mining company, of force majeure on shipments from the Dawson coal mine in Queensland, Australia, may also boost freight rates.
Cargo costs: Capesize rates slumped to US$172,087 while panamax rates rose to US$94,977 and supramax rates are at an all-time high of US$72,729
The Baltic Dry Index, an overall measure of commodity shipping costs on different routes and ship sizes, fell 1.3 per cent to 10,886, based on data from the London-based Baltic Exchange. The decline is the most since June 14. Hiring rates for a capesize slumped 4.3 per cent to US$172,087 on average on Tuesday, the lowest since Oct 8.
China, producer of one-third of the world's steel, may boost imports of iron ore, the steelmaking ingredient, by 40 million tonnes in 2008, Luo Bingsheng, vice-chairman of the China Iron & Steel Association, said yesterday. Iron ore imports will rise from this year's estimated 370 million tonnes, he said. Demand for iron ore, the single-biggest commodity shipped by sea, helped more than double freight rates in the past year.
'In a dry bulk environment at which fleet utilisation is 97 per cent to 98 per cent, only small adjustments to demand tend to have a large impact on short-term rates,' Henrik With and Glenn Lodden, analysts at DbN Nor Markets, said in a statement yesterday. 'We view the fall in physical capesize rates as normal volatility in such a market.'
While capesize rates fell, hiring cost for a panamax, which can move 70,000 tonnes of cargo, rose for the eighth day to US$94,977 on average on Tuesday, according to the Baltic Exchange's data. The charter rate for a supramax, which can haul between 50,000 tonnes and 59,999 tonnes of goods, increased to an all-time high of US$72,729 on average on Tuesday. It has been setting a daily record since Sept 24.
China's switch to a net coal importer in January and congestion at ports also contributed to higher freight rates. At Australia's Newcastle, the world's largest export harbour for thermal coal, the number of ships waiting to load the fuel rose to 39 on Oct 29 from 37 on Oct 22, Newcastle Port Corp said on its website.
The coal carriers waited an average of 16.7 days to load, longer than last week's 15.55 days. The port's coal shipments fell to 1.66 million tonnes for the week ended Oct 29 from 1.96 million tonnes a week earlier, Newcastle Port said.
The declaration by Anglo American plc, the world's second-biggest mining company, of force majeure on shipments from the Dawson coal mine in Queensland, Australia, may also boost freight rates.