Average spot rates for capsize bulkers plummeted by a third over the past week as Asia celebrated the week-long Chinese New Year holiday.
The Baltic Exchange’s Capesize 5TC basket of average spot rates across five key routes dropped 31.2% over the seven-day period to $4,443 per day, falling to its lowest level in nearly five months.
Rates for two benchmark iron ore routes fell the most over the week, reflecting China’s lower demand for the commodity as its steel industry and other sectors break for the Lunar Year festivities.
The average spot rate for the C10 roundtrip iron ore voyage from Australia to China cascaded 38.6% to $2,650 per day, while the C14 roundtrip ore voyage from Brazil to China slipped 24.3% to $3,700 per bday.
“The Baltic Exchange’s freight index for the capesizes continued to decline yesterday as the holidays in China weighed on activities,” Shipfix senior economist Ulf Bergman wrote in a report on Friday.
“The gauge for the largest vessel segment extended its recent run of sessions in the red to an eighth consecutive day.”
Australian mining giant Rio Tinto hired two unnamed capesizes on Thursday and Friday to carry 170,000 tonnes of iron ore each from Dampier, Australia, to Qingdao, China at $6.25 per tonne.
The ships will get loaded from 8 to 13 February.
On 19 January, Rio Tinto fixed two unnamed capesizes to carry the same amount of ore on the same route. One capesize earned $6.60 per tonne, while the other one made $6.70 per tonne.
Both of those ships will take on ore from 3 to 5 February.
Average spot rates for the smaller bulkers moved mostly sideways over the week.
The Panamax 5TC slid 4.5% over the past week to $7,700 per day on Friday, while the Supramax 10TC lost $21 per day over the same period to land at $7,150 per day.
The Handysize 7TC shed $168 per day over the week to attain $7,763 per day on Friday.
“Despite something of a midweek push from first-half February grain demand out of North Coast South America, it returned an uninspiring week,” Baltic Exchange analysts wrote on Friday.
“Quelled by various holidays in Asia, market values eroded further with minimal support seen throughout.”
The Baltic Dry Index dropped significantly over the past week as a result of the falling average spot rates across dry bulk shipping, falling 11.4% to 676 points on Friday.
