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Asia Dry Bulk-Capesize Rates Firming on Cargo Volumes
Freight rates for large capesize dry cargo ships on key Asian routes are likely to hold around current levels or nudge slightly higher next week on buoyant cargo volumes, likely supported by a raft of off-market charters, ship brokers said.“The market is plodding along – it’s been a quiet week. It’s not going to change massively,” a Singapore-based capesize ship broker said on Thursday. That came as capesize charter rates from Western Australia to China inched up this week, while freight rates from Brazil to China climbed to their highest since May 17, chartering data on the Reuters Eikon terminal showed. “Charterers are slowly picking off ships. There is a lot of hidden tonnage and a lot of deals are being done under the table,” the broker said. Average earnings for a 175,000 deadweight tonne (dwt) capesize ship are currently around $5,400 per day for a voyage from Western Australia to China and $9,000 per day from Brazil to China, according to data from shipping services firm Clarkson. That compares with a 2016 average of $2,900 per day on the Australia-China route and $7,000 for Brazil-China. Operating costs for a capesize vessel are around $7,200 per day, according to accountancy firm Moore Stephens. “Freight rates have found support and keep firm, mainly due to a healthy volume of cargoes out of west coast Australia,” Norwegian ship broker Fearnley said on Wednesday. “It is a slightly more positive atmosphere out there and the expectations are carefully optimistic.” With charter rates barely covering operating costs, dry cargo shipowners need to adopt tough measures to achieve profitability by the end of the decade, ship owners’ lobby group BIMCO said on Tuesday. “We need to demolish an enormous number of ships and refrain from building new ships. The medicine is not going to be easy to take,” said BIMCO President Philippe Louis-Dreyfus. Dry cargo bulk carriers totalling 20.2 million dwt have been scrapped this year, up 56 percent on an annualised basis from 30.6 million dwt in 2015, Clarkson data showed. Freight rates for Brazil-China rose to $8.46 per tonne on Wednesday, from $7.84 last week. Capesize charter rates for Western Australia-China climbed to $4.31 per tonne on Wednesday, against $4.05 the same day last week. Charter rates for smaller panamax vessels for a north Pacific round-trip voyage fell to $4,378 per day on Wednesday from $4,700 a week earlier on reduced cargo volumes. Freight rates in the Far East for smaller supramax vessels were around $5,500 per day this week, Fearnley added. The Baltic Exchange’s main sea freight index climbed to 612 on Wednesday from 605 last week. Source: Reuters (Reporting by Keith Wallis) PWCS terminal coal exports to China surge to 16-month high in May Shipments to China from eastern Australia’s Port Waratah Coal Services terminals jumped to a 16-month high of 1.6 million mt in May, up 21.2% month on month from 1.32 million mt in April, said the Newcastle coal terminals operator in a performance report, Wednesday. China’s offtake from the PWCS terminals last month was the highest since January 2015 when 2.16 million mt of coal was shipped, according to PWCS data. Traders said that Chinese buyers were attracted to Newcastle thermal coal over the past month as its price was lower than comparative calorific value domestic thermal coal in China. Prices for Newcastle 5,500 kcal/kg NAR thermal coal, the preferred product for Chinese buyers, averaged $43.80/mt FOB in May and a similar level in April. In comparison, domestic coal prices in China were currently at around $50/mt FOB North China ports basis 5,500 kcal/kg NAR, said traders. But Chinese demand for Newcastle coal was still lagging last year’s levels with 5.2 million mt shipped to China through the PWCS terminals over the January-May 2016 period. This is compared with 6.8 million mt in the corresponding 2015 year-to-date period, according to port data. Japan Volume Marginally Lower Japan took delivery of 4.38 million mt of PWCS coal exports in May, down marginally from 4.44 million mt in April, said PWCS. Over January-May, Japan received a total 21.5 million mt of coal from PWCS terminals, up from 20.7 million mt in the year-ago period. South Korean buyers received 930,000 mt of Newcastle coal in May, up 10.7% month on month from 840,000 mt in April. South Korea has taken delivery of 5.9 million mt of PWCS coal over January-May, down 1 million mt from 6.9 million mt in the year-ago period. Taiwan received 1.22 million mt of coal from PWCS terminals last month, up from 1.1 million mt in April. India received only 34,000 mt of PWCS coal last month, down substantially from 134,000 mt in April. For the year to date, India has taken delivery of 586,000 mt of coal from the PWCS terminals, double the 276,000 mt it lifted in the January-May 2015 period, said the PWCS report. About 7.97 million mt of PWCS’ May exports was thermal coal, equivalent to 85% of its May shipments, and 1.4 million mt or 15% of last month’s tonnage was coking coal, giving total exports of 9.38 million mt. Newcastle port has another coal terminal operated under the Newcastle Coal Infrastructure Group banner that does not publish regular information on its shipping data. The NCIG terminal has a capacity of 66 million mt/year and is operated by five coal producers including BHP Billiton, Peabody Energy and Whitehaven Coal. Posted by: badanov 2016-06-04 |
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