Newly reported period fixtures show advances in rates for kamsarmax bulkers as sentiment begins to warm up, following a mediocre past week.
Rates have been rising gradually all month long but have not caught fire during grain season in the Americas which has failed to surpass 2023’s record year.
There are still too many vessels relative to cargoes for the big bucks to follow, but this could still change.
“The confidence to take period ships has improved, which further suggests the outlook is a little rosier going forward in the short term,” Braemar Shipbroking’s research team remarked in a market report on Thursday.
Sentiment has improved but modestly, it added.
Great Eastern Shipping’s 81,732-dwt Jag Arnav (built 2015) was reported fixed on Thursday to grain house Archer-Daniels-Midland for four to six months at a daily rate of $16,500, delivering retrospectively to the charterer on 12 August.
This is $1,000 per day more than a similar fixture made a week earlier.
K Line Shipping agreed to pay $15,500 per day for five to seven months for Diana Shipping’s 82,194-dwt kamsarmax Medusa (built 2010) on 12 September. The contract commenced three days later.
Spot
Spot rates crept forward a little more on Friday — but only a little.
Baltic Exchange panellists added an extra $89 to their estimate of spot rates across five benchmark routes, pushing the basket assessment to $13,842 per day.
The assessment has been trending upward since September began and has gained almost 18% in that time.
“North Atlantic rates seem to have found a floor, which has brought some sense of optimism to the area after an uninspired last few weeks,” Braemar said.
“A handful of cargo ex-[US east coast] has bolstered enquiry volumes, helping to occupy what remains a reasonably well-stocked Continent tonnage list.
“Those that can are continuing to line up internal tonnage behind their cargoes as market rates are still not where some hoped they were.”
What could kick-start the spot market are arbitrage opportunities, which could arise if cargo volumes from the US east coast stay steady and rates continue to rise, Braemar added.
“[The US Gulf] has also seen a handful of cargo, but with a few committed ships around, charterers have focused their attention there, obligating ballasters to seek business in other regions,” the brokerage said.
Brazilian exports of corn and soybeans have been more subdued, with August’s combined corn and soybean exports down by 3.6m tonnes on the record levels in 2023, according to trade data cited by Braemar.
Chinese demand for corn has been weak, hampering exports. Soybean volumes also have been winding down since mid-September as the end of the export season approaches.
Port congestion in Brazil has also decreased this year as a result, returning more vessel supply to the trading fleet.
Data from bulker tracking platform Oceanbolt currently identifies 133 panamaxes caught in congestion in Brazil, down from the year-to-date peak of 140 vessels on Wednesday.
A year ago, the number of congested panamaxes at Brazilian ports peaked at 210 vessels, according to Oceanbolt.
One year
Reported rates for one-year periods are proving more elusive. Brokers have reported at least four such deals this month so far, none of which have disclosed rates.
But the fixtures that have revealed rates continue to highlight the disparity in earnings for older, less-efficient vessels and brand-new, eco-type units with scrubbers.
Xiamen Datong Xinluyang Shipping’s 81,055-dwt, scrubber-less kamsarmax Prevail Star (built 2014) was fixed to an unreported charterer at $15,400 per day for a year at the end of August.
This pales in comparison to what Shandong Shipping achieved a few days earlier when it fixed out a brand-new kamsarmax, which has scrubbers and a more efficient design.
The 82,000-dwt Shandong Xin De (built 2024) will earn $18,500 per day over the next 12 months while on contract to an unnamed counterparty.
Shandong Shipping leases the vessel from Everbright Leasing of China.
Clarksons currently estimates one-year period rates of $15,500 per day for kamsarmax bulkers, down from the estimate’s 18-month high of $19,000 per day in mid-March.
More generally, a scrubber-fitted kamsarmax built in 2015 can currently expect earnings of $15,552 per day, according to Clarksons’ estimates.
This compares with estimated daily earnings of $11,450 per day for a 2010-built, 76,000-dwt panamax without scrubbers.
